Agroforestry and Forestry in Sulawesi series: Profitability and land-use systems in South and Southeast Sulawesi

This profitability assessment is an early effort to generate baseline information for the
Agroforestry and Forestry in Sulawesi: Linking Knowledge with Action project (the ‘AgFor
project’), for implementation in two provinces, South Sulawesi and Southeast Sulawesi. The
study collected information on existing farming systems and estimated profitability for each
land use. The profitability indicators used in the study are: net present value (NPV),
equivalent annuity and return to labour. Our estimation shows that in South Sulawesi the most
profitable land-use system using the annual equity measure was clove gardens, followed by
coconut-cacao mixed-gardens and coconut-gardens. Timber-garden systems generated the
highest return to labour of the other land uses, while the coconut used for sugar system
generated the lowest (USD 6 per day). In Southeast Sulawesi, the most profitable land-use
system using the annual equity measure was timber-gardens (teak), followed by pepper
monoculture, and patchouli monoculture. Timber-gardens (teak) generated the highest return
to labour of the others, while the cacao monoculture system generated the lowest (USD 10 per
day).