Economic evaluation of investment in new olive groves (25 ha) in the karst - Research results of recultivation of the karst in the district of Tisno (Giri？a rat)

Sa？etak To increase the production areas, and because of the lack of arable agricultural land in the coastal part of Croatia, karst terrains are increasingly being turned into and cultivation by melioration agricultural arable land for intensive farming. Cultivation and melioration of karst are financially demanding projects for adapting soil to be suitable for growing crops, such as cleaning and removal of overhead vegetation, leveling the terrain, scarifying, plowing, and grinding stones and rocks. Since the first step in preparation of karst terrain and the basic prerequisite for the successful raising of the newly planted olive trees represents the biggest outlay in investment costs, in this context the goal of this paper is to analyze and assess economic and financial feasibility of investments. A model calculation has identified investment and production costs and revenues that represent the input parameters for the economic cost-benefit analysis, sensitivity analysis of the investment and economic analysis of the measure of business success. The results of analysis of the investment indicate that investment to raise 25 hectares of olive trees on karst is economically and financially viable and effective, under the assumption of expected yields provided and marketing of olive oil