Production costs and land appraisal: A case study of Polatlı, Turkey

Abstract

ABSTRACT: In this study, the share of land rent in the fixed costs of wheat production was examined, and the aim of the study was to find land values using cost tables. To this purpose, we showed the effect of these on land values from the difference between field rents and net income. The study covered the district of Polatlı in Ankara province. Data on wheat production in Polatlı in 2017 was collected from six villages and 37 farms by means of a questionnaire. In selecting the farms, the ability to determine the land rent was taken into account as a selection criterion. The farms examined used on average per hectare, 11.9 hours of labor, 7.7 hours of draft power, 354.3 kg of fertilizer, 205.5 kg of seed, and 1.5 liters of agricultural chemicals. The average wheat production cost per hectare was $865.42; the average unit production cost was $0.23, and the production value was reported to be $1012.40/da. In this study, the land rent was of $225.40, and the net income from the land was reported to be $372.42. It was reported an evaluation performed using the taxation tables that land values according to rental incomes were $4508.80/ha, and $7448.40 when the land was worked by the landowner. Land rent constituted 26.05% of total production costs, and were equivalent to 22.26% of production value. When crop prices increased by 1%, income from the land increased by 4.49%.

Keywords

• production cost
• physical inputs
• land rent
• income capitalization method