Financial Evaluation of Zaraibi Goat Breed Rearing under Two Production Systems.

Abstract

Sixty-six kids of both sexes produced from twenty does of Zaraibi goat breed were taken from an experimental herd and used to evaluate the profitability of two production systems, intensive and semi-intensive, for meat production. Benefit cost ratio (B/C ratio), Net present value (NPV) and Internal rate of return (IRR) were used in the financial analysis. A sensitivity analysis was also conducted at the discount prices of 22% and 25% in the event of an increase and a decrease in production costs of 5% with all other factors remaining constant. The results of the financial evaluation for Zaraibi goat raised under the intensive production system showed that the benefit/cost ratio (B/C ratio) in the first year of the project at the discount rates of 22% and 25% reached about 1.080 and 1.084 for each of them, respectively. However, for those raised under the semi-intensive production system, the results showed that B/C ratio reached about 1.084 and 1.080 for each of them, respectively. The net present value of the project (NPV) at the discount rates of 22% and 25% amounted to 22,084 and 21,554 thousand Egyptian pounds for each, respectively under the intensive production system and amounted to 21,098 and 20,592 thousand Egyptian pounds for each, respectively under the semi-intensive production system. The internal rate of return for the project (IRR) was about 33% in the case of intensive production system and was about 32% in the case of semi-intensive production system. We can conclude that rearing Zaraibi goat for meat production under the intensive production system was more profitable (i.e., higher NPV and IRR) than this under the semi-intensive one. The sensitivity analysis conducted in the event of an increase or a decrease in production costs of 5% confirmed that the project is economically feasible for the two production systems.