Profitability analysis of cut flower cultivation in Bangladesh: Constraints and opportunities

Bangladesh has immense potential for cut flower production and export to the world market. Although the export earnings from cut flower cultivation are gradually increasing in our country, production and profitability are hindered by some constraints. The present study was undertaken in Jashore (Jhikargachha) and Dhaka (Savar) districts to examine the financial profitability, constraints, and opportunities of cut-flower cultivation in Bangladesh. A total of 120 cut flower cultivating farmers were selected for interview in 2019, taking 60 sample farmers from each location. Multi-stage random sampling method was followed to collect primary data. For profitability analysis, two cut flowers, namely gladiolus and rose, were selected for the study. The result indicates that per hectare total cost, net return, and benefit-cost ratio (BCR) were Tk. 687439, Tk. 261509 and 1.38, respectively, for gladiolus cultivation. On the other hand, net present value (NPV), internal rate of return (IRR), and BCR of rose cultivation were Tk. 2325762, 146%, and 1.46, respectively, indicating that rose production is highly profitable to the farmers of the study areas. Despite such potentialities, cut flower cultivation was constrained by the requirement of high initial investment, lack of modern varieties, lack of credit facility, lack of storage facility, attack by pests & diseases, and uncertain market price. However, there is a huge scope to increase cut flower production by removing constraints in Bangladesh that can boost up livelihoods, incomes, and living conditions of rural people.


Introduction
The fertile land and favorable climate conditions are suitable for flower production in Bangladesh.Flower production was initially begun in the late seventies in our country by some innovative farmers on a small-scale, but rapid commercial production was initiated in the mid-eighties, especially in the Jashore district (Jahan, 2009).Commercially grown most common flower species in Bangladesh are rose (Rosa indica), tuberose (Polianthes tuberosa), marigold (Tagetes erecta, T. patula) and gladiolus (Gladiolus spp.).Currently, around 10000 hectares of land are under cut flower cultivation, and approximately 5000 promising farmers are cultivating flowers and foliage as their sole livelihood (Ahmed et al., 2021;Jahan, 2009).More than 0.15 million people in Bangladesh are engaged in the floriculture business directly or indirectly (Rakibuzzaman et al., 2018).Flowers are usually used in various social functions such as weddings, worshipping, interior decoration, religious functions, birthday parties, and welcoming friends, or relatives as a symbol of beauty.
Bangladesh has a competitive advantage in flower production due to the availability of nursery plants and seeds, easy production technology, competitive prices, and export potentialities (Ahmed et al., 2021;Mou, 2012).The current size of the flower market is around Tk. 10 billion and flower is being grown across the country (Laboni et al., 2019).Bangladesh exports various kinds of flowers and floral products to different developed countries like Italy, the United States, Portugal, Saudi Arabia, Singapore, Japan, Britain, Germany, and France etc. (Laboni et al., 2019).
Floriculture appeared as a winsome business because many farmers converted to floriculture from other crops for higher benefits (Mou, 2012;Rakibuzzaman et al., 2018).As a result, it not only generates employment opportunities for many, especially poor women but also enlarges the scope to export.However, due to various production problems and lack of government support, cut flower producers face losses, which can narrow the potentiality of flower exports (Chowdhury and Khan, 2015).So, realizing the above importance a study was undertaken in two different locations of Bangladesh to examine the financial profitability and constraints of cutflower production in Bangladesh to derive some policy recommendations supporting cut-flower production.

Materials and Methods
Two cut flowers, namely rose and gladiolus were selected for analyzing the profitability of cut flower cultivation.Based on area coverage, two Upazila from two districts, namely Jhikargachha Upazila from Jashore district and Savar Upazila from Dhaka district were selected for the study.A multistage random method was followed to collect data.A total of 120 farmers were selected for interview, taking 60 farmers from each location.Secondary data have been collected from the Bangladesh Bureau of Statistics (BBS), Hortex Foundation, Export Promotion Bureau (EPB), national & international journals, articles, and earlier research reports.A mostly tabular method of analysis was followed to achieve the objectives of the study.The profit function and project analysis were used in the study.The profit equation was used to estimate the profitability of gladiolus flower cultivation (Islam et al., 2016;Miah et al., 2019).The net return of gladiolus cultivation was estimated as follows: Where, π = Net return from i th flower per hectare; Pijk= Per unit price of i th flower (Tk.unit - 1 ); Qijk= Quantity of i th flower (unit ha -1 ); TVCijk = Total variable cost of i th crops (Tk ha -1 ); TFCijk= Total fixed cost of i th crops (Tk ha -1 ); i (1..2)= number of flower; j (1..2)= number of location and k (1…..120) = number of farmers.Data were categorized according to the year for the rose.The age of the rose garden was classified as 1 st year, 2 nd year, 3 rd year, 4 th year, 5 th year, 6 th -9 th year, and 10 th -12 th year.In presenting the results, tabular methods of analysis were used using descriptive statistics.The NPV, BCR and IRR have been calculated in the case of rose cultivation with the help of the following formula (Kaysar et al., 2017;Kaysar et al., 2019): Where, Bt = Total benefit (Tk/ha) in t th year; Ct = Total cost (Tk/ha) in t th year; t = Number of year and i = interest (discount) rate.
Where L represents a lower discount rate and H represents a higher discount rate.

Production practices of cut flower cultivation
The most appropriate planting time of gladiolus and rose was October to December and mid-February to April in the study areas, respectively (Table 1).Farmers cultivated exotic varieties of gladiolus like Pink, Kolmi, Beguni, Sada, and Halod varieties.In case of roses, the farmers cultivated Lingkon and Mirinda varieties for grafting on the rootstock.Both rose and gladiolus farmers had little knowledge about modern flower varieties.The plant-to-plant distance for gladiolus and rose cultivation was found to be 6 inches and 13-15 inches, respectively, while lineto-line spacing was found to be 6-9 inches and 13-18 inches, respectively (Table 1).The average no. of seedlings required for gladiolus and rose cultivation was 800-1000 and 130-136 decimal -1 , respectively, in the study areas.The average no. of weeding ranges 6-10 times in all areas.The irrigation requirement was higher for rose cultivation compared to gladiolus cultivation (Table 1).

Profitability analysis of gladiolus cultivation
The result indicates that, on average, 393 mandays ha -1 of human labour were applied by gladiolus farmers, but it varied from district to district (Table 2).Farmers used 212485 corms as a seed per hectare in all areas.The gladiolus farmers applied per hectare 6612.5 kg cow-dung and 23 kg oilcake as an organic fertilizer in all the selected areas.The farmers of Dhaka district used more cow-dung (7382 kg ha -1 ) relative to Jashore (5843 kg ha -1 ) district.The farmers applied Urea, TSP, DAP, MOP, and Gypsum fertilizers at the rate of 267 kg ha -1 , 806 kg ha -1 , 97 kg ha -1 , 151 kg ha -1 , and 124 kg ha -1 , respectively, but mostly in an unbalanced way (Table 2).Proper agronomic management practices like those that balanced fertilizer application can enhance rose and gladiolus yields in the study areas.There are lot of evidence that balanced fertilizer application practices can improve both crop yields and farming profitability (Islam et al., 2022a;Islam et al., 2022b).However, the results show that the total production cost of gladiolus was Tk. 687439 ha -1 in which the TVC was Tk. 670598 ha -1 and the TFC was Tk. 16841 ha -1 (Table 3).The total production cost of Savar farmers (Tk.716064 ha - 1 ) was found to be higher relative to the farmers of the Jashore district (Tk.659609 ha -1 ) due to they used comparatively lower inputs than farmers of the Dhaka district.Among different cost items, the results implied that seed cost was the highest (Tk.460126 ha -1 ), followed by human labour (Tk.107592 ha -1 ), fertilizer (Tk.55577 ha -1 ) and irrigation (Tk.20592 ha -1 ) (Table 3).The returns came from gladiolus cultivation in two ways: as a flower (stick) and as a seed (corm).
The yield of the gladiolus flower was around 179350 stick ha -1 , whereas, in the case of corm yield, it was found at 146335 corm ha -1 .On average, the gross return, gross margin, and net return of gladiolus cultivation was Tk. 948948 ha - 1 , Tk. 278350 ha -1 and Tk.261509 ha -1 , respectively, whereas the average BCR was estimated at 1.38 in all selected areas.The highest BCR (1.45) was found in the Jashore district (Table 4).

Profitability analysis of rose cultivation
The results show that, on average 1165 man-days ha -1 human labour was required for rose cultivation (Table 5).Farmers used an average of 6264.1 kg ha -1 cow-dung.The highest 7567 kg ha -1 cow-dung was used during the 1 st year of gardening, whereas the lowest 5293 kg ha -1 was used in the 3 rd year of gardening.On average, farmers used 775 kg ha -1 of oilcake in rose cultivation.Similar to gladiolus, the rose farmers applied 319 kg ha -1 , 936 kg ha -1 , 51 kg ha -1 , 177 kg ha -1 , and 172 kg ha -1 of Urea, TSP, DAP, MOP, and Gypsum, respectively, without following scientific recommendations (Table 5).Different cost items like human labour, seedlings, organic fertilizer, inorganic fertilizer, pesticides, irrigation, bamboo sticks, rope, net, etc., were included to estimate the total production cost of rose cultivation (Table 6).Land use cost was added as a fixed cost.The seedling cost was required only for the first year, and it was highest (Tk.377786 ha -1 ) among different cost items.
Among various cost items, human labour cost was the highest cost in the subsequent years.The average per hectare total cost was Tk. 634975 in all study areas.The highest cost (Tk.980986 ha -1 ) was observed in the 1 st year garden due to the high cost of seedlings (Table 6).7, it is apparent that the highest yield (1133316 stem ha -1 ) was found in the 2 nd year garden, which started to decline from the 3 rd to the subsequent year.Gross return was estimated as yield multiplied by the price of a rose stem.The price varied from area to area and season to season.The average gross return was obtained at Tk. 863479 ha -1 in which the highest gross return was found in 2 nd year (Tk.1246648 ha -1 ) and the lowest in 1 st year (Tk.554066 ha -1 ).The average net return was found (Tk.314852 ha -1 ) similarly highest in the 5 th year (Tk.674752 ha -1 ).The negative net return was found in 1 st year (Tk.-426921 ha -1 ) due to high initial investment.In the study, the best discount factor was considered at 6.5% (See appendix Table A1 and  A2).The discounted gross cost and benefit of present worth at a 6.5% rate of interest was Tk. 5094902 ha -1 and Tk.7420663 ha -1 , respectively.The estimated average net present worth of rose cultivation at a 6.5% discount rate was Tk. 2325762 ha -1 in the selected locations.On the other hand, the estimated BCR was 1.46 at a 6.5% rate of interest, which indicates that rose farmers are getting higher profits compared to gladiolus farmers.In the rose cultivation project, the IRR was 146%, which was greater than the opportunity cost of capital.Therefore, it is acceptable and highly profitable (See Appendix Table A1 and A2).Similar types of results are also reported by Jahan (2009) while examining the financial analysis of cut flower production.Cultivation of flowers can provide almost 3-5 times and 1.5-2.0times higher profits compared to rice and vegetables, respectively, in Bangladesh (Mou, 2012).

Conclusion and Policy Recommendation
There is a high market demand for increasing diversified use of various flowers in Bangladesh.
It is clear from our study that cut flower production is more profitable than other cereal crops, though it requires high investment initially.The profit margin is comparatively high for rose cultivation relative to gladiolus cultivation.Many new farmers are getting involved in flower cultivation, and it is being promoted gradually in our country.Lack of storage facilities, lack of modern varieties, lack of credit & training facilities, and uncertain market prices are hindering cut flower production.
Following policy recommendations should be taken by the Govt. of Bangladesh to improve cut flower cultivation covering the above constraints.
i. Cold storage facilities should be developed at the production point, as cut flowers are highly perishable.ii.Flower-growing farmers need to be informed about modern flower production technologies like fertilizer, HYV seed, irrigation water, the new variety of flowers, flower caps, packaging materials, etc., through training programs and demonstration.iii.Market information should be easily accessible to the farmers so that farmers can be aware of uncertain market prices.To ensure better prices, a contract growing system should be encouraged for the farmers.iv.Cut flower cultivation should be supported by the Govt. of Bangladesh to coordinate the public-private partnership (PPP).v. Institutional credit facilities should be made easily available for cut flower farmers.

Table 1 .
Production practices of cut flower cultivation by the farmers.

Table 4 .
Per hectare yield, gross return, and net return of gladiolus cultivation.

Table 6 .
Per hectare total cost of rose cultivation (Tk.ha -1 ) in the study areas.

Table 7 .
Per hectare yield and return of rose cultivation in the study areas.