LOCAL VARIETIES AND ECONOMIC ASPECTS OF INVESTMENT IN VINEYARD ESTABLISHMENT: THE CASE OF SERBIA

Mladen Petrovic; Marko Jeločnik; Darko Jakšić; Ivan  Bradić

doi:10.59267/ekoPolj2503943P

Authors

Mladen Petrovic Institute of Agricultural Economics, Volgina Street no. 15, 11060 Belgrade, Serbia https://orcid.org/0000-0002-4390-9711
Marko Jeločnik Institute of Agricultural Economics, Volgina Street no. 15, 11060 Belgrade, Serbia https://orcid.org/0000-0003-4875-1789
Darko Jakšić Institute of Agricultural Economics, Volgina Street no. 15, 11060 Belgrade, Serbia https://orcid.org/0000-0002-3186-8932
Ivan Bradić Center for Viticulture and Oenology, Kolonija EI no. 6, 18116 Niš, Serbia https://orcid.org/0009-0000-6859-6902

DOI:

https://doi.org/10.59267/ekoPolj2503943P

Keywords:

vineyard establishment, Tamjanika Bela variety, investment analysis, dynamic methods, Serbia

Abstract

Recently, entry into grapevine growing as initial step for wine production has become a wise business decision in Serbian agri-sector. Along promising possibilities for maintaining farm economic sustainability, many new or renewed vineyards have been established. It has become common that, within such vineyards, alongside commercially and internationally recognized grapevine varieties, certain local ones, such as Tamjanika Bela, are also planted. The main goal of the research was to develop the investment analysis towards vineyard establishment as a relevant tool in decision-making process (investment doesn’t involve land acquisition). The applied methodological framework included selected dynamic methods for economic assessment of investment (Net Present Value – NPV, Internal Rate of Return – IRR and Dynamic Payback Period – DPP) supported by field data from one grape producer in Trstenik wine-growing subregion. The results, NPV of 2,418.87 EUR, IRR of 8.81%, and DPP of 9 years and 1.46 months, confirmed economic justification of vineyard enlargement.

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References

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