How profitable is lemon farming in India? The business of Lemon and Lime
You may have come across articles with headlines saying Organic farmer with 2 acres of lemon cultivation makes 10 Lakh rupees per acre. or something like Lemon farming makes a massive profit for Tamilnadu farmers. Have you wondered if this is true or if it’s just some marketing gimmick? Well, there are a few facts to the news you hear but what you hear has to be taken with some salt.
In reality, it’s not just lemon farming that makes the farmer with 2 acres of land rich. There are a lot of problems with lemon farming. Take for instance, when during monsoon you get lemon in abundance and the price is 20 rupees in retail per kilo. Do you think it’s a profitable business for the farmer who sells it to the mandi at 10 rupees or 15 rupees a kilo?
Take another scenario. Price of lemon soars are climate conditions worsen in many parts of India. Do you think farmers are going to make profits even though the price is increasing? Remember the price increase means a lack of productivity. Farmers do not have the product to sell in the market and they don’t make enough money.
But even with all the terrible news going around, there are a few farmers who make an excellent profit even in worse conditions.
How do farmers Profit from lemon cultivation even in adverse conditions?
- Processed food: Farming is in general, marginally profitable. May it be lemon or any other crop from vegetables, fruits or grains. Almost all crops are profitable. But then there are times when farmers fail. It’s either because the market is flooded with the products which lead to price fall or farmers lose their crops and produce due to some natural calamity. While natural calamities cannot be tackled, there are ways to manage excess produce when the prices are extremely low. Hamish Parmar from Gujarat is one of the few farmers who realized that it wasn’t feasible to sell his lemons at rock bottom price and had to do something about it. He started his unit of lemon pickles when the price is low which he could later sell at a good price. This surely takes a lot of effort, but his production is not sold cheaply and the processed food product sells at a premium price too. The added benefit of the longer shelf life of the pickles makes them even more beneficial for the farmer.
- Man Power: For most farmers, the cost of cultivation of any crop can go high or low depending on how much manpower he is willing to bring into the farm through the family. Employing labourers for every task can be a burden on the farmer. While it’s not feasible for 1 or 2 people to pick lemons from a 2-acre of land during peak seasons, it’s surely a task easily handled during off-seasons. Handling most of the tasks like picking, fertilizing and irrigation by the farmer and his family will reduce costs by 30% in manpower alone. While it’s inevitable at times to employ labourers, this should be to the minimum. Even during peak season, it’s only sensible to get all family members to pick the fruit to reduce the cost by 200 rs per person. While this does not seem like a lot, a family of 3 people can save 600 rs to more than 1000 rs per day in labour costs.
- Adding technology: Lemon farming is profitable only when you have lemons during the off-season. The off-season for lemon is the summer, generally from March to May. This is the time when lemon prices go up to 80 rs per kilo and sometimes even more. the problem is that lemon yield is low during this period if there is no proper irrigation. Managing water and providing sufficient irrigation to the trees will provide fruits. This also needs to be supplemented with fertilizers for the plant to help yield during this period. Drip irrigation, proper fertilizer management and pest management will help farmers yield 3-4 times what they usually make. An alternative is to incorporate organic farming, where the input to chemical fertilizers is low, reducing cost naturally. This should only be done with proper guidance as it may affect the crop adversely too if you do not know how to do it right.
- Turning organic: Organic farming is not for the weak-hearted. You need a different set of skills to manage a farm organically. It also requires a heart which understands plants and food differently. When it comes to commercial farming, most farmers do not dare to go organic. on the other end, consumers are looking for organic produce and will pay a heft price for organic food. Turning your lemon farm organic is not very hard. the price you get for your product could vary anywhere from 20-50% extra in revenue while reducing the costs of pesticides and chemicals. The myth that organic farms far less produce is also evident in many farms that produce an equal amount of food when compared to those commercially cultivated.
Farmers in general are excellent at producing food. May it be lemon or any other food product, they will learn and produce them. The key to making a profit is not in the quantity you make (though it’s always believed that the more food you grow, the more money you make). it’s in how you manage your produce. it’s in how you manage your resources and also how you market yourself. When farmers all over the country are selling their lemons at 80 rs, a farmer in Tamilnadu could sell his produce for 20 rupees more per kilo. That’s a significantly higher price when you consider the fact that he sells almost 150 KG per week or 600 kg a month. His weekly revenue is 15,000 rs and during a good month, his revenue goes up to 75000 rs. His annual turnover exceeds 2 Crores in revenue.
Lemon Cultivation and profit per acre – the real numbers
A normal lemon farm contains roughly 200-250 plants. They start producing fruits in the second year but the yield is roughly 50 fruits in the first year and around 350-400 fruits in the third year. the tree reaches its full potential from the 10th year and some trees take a bit longer at 15 years. While the yield of lemon depends on the variety of the tree, a good variety has a potential 3000 Fruits per tree once the plant is well established. the average weight of lemon is between 21 and 45 grams per piece. With an average weight of 25 grams per fruit, you can expect a total yield of 75 KG per tree. in an acre with 200 plants (on the lower side) you are looking at 15,000 kilos of Lemon per year. That’s 15 Tonnes, of which nearly 50% of the products will be harvested when the price is low at rs 10 per kilo (wholesale) and 20% produce sold at a peak price of 80Rs per kilo. the remaining products will be sold at an average price of 35 rs per kilo.
so during peak season Sold 7500 KG = Rs75000 (@10 rs per Kg)
During off-season Sold 3000 KG = 300000 (@100rs Per kg)
Remaining Quantity 4500 KG = 157500 (Sold at 35 Rs per KG)
Total Revenue from one-year sale = 5,25,0 Rs
While this may seem like an exorbitant amount already, it’s important to consider a few facts before you jump to conclusions here.
Drawbacks of Lemon farming and its impact on farmers.
- The yield for the first 3 years is Zero, while the expenses may amount anywhere between 50,000 Rs to 75,000 Rs in Maintenance alone. This does not include the cost of plant and labour required to plant them
- The yield from the 4th year to the 8th year is barely enough to cover the cost of the previous years while breaking even the cost incurred in the maintenance of the current year.
- Farmers realize profit only from the 9th year and some farmers who have loaned money will see it even later depending on the loan amount and interest.
Many farmers run into debt, especially when they cultivate lemons on a large scale. An acre of the lemon farm requires 50,000 rupees or upward for management, with or without its yield. Regular irrigation, weeding and keeping the farm clean are important. This cost is incurred by the farmer even when there is no revenue during the first few years. to come up and meet the expenses of maintaining the farm, farmers are encouraged to intercrop other plants in the same plot for the first 3-4 years with legumes and other root vegetables.