Financial Evaluation of Saffron Production in controlled conditions in Mazandaran province

This study used the benefit-cost analysis and various financial indicators, such as Net Present Value, Benefit-Cost Ratio, Internal Rate of Return, and Payback Period, to determine the economic feasibility of saffron production under controlled conditions in Mazandaran province. Data for calculating these financial indicators were collected through field surveys, questionnaires, interviews with experts and specialists from the Agriculture Jihad Organization of Mazandaran province, and by obtaining fixed and variable costs as well as income from the establishment of controlled environment spaces for saffron production (spaces with areas of 200 square meters, 1000 square meters, and 5000 square meters) from agricultural service centers. The collected data were analyzed and evaluated using COMFAR software version 3.3, and the results, including financial indicators and sensitivity analysis under different scenarios, were presented. The findings suggest that at a discount rate of 18% and an inflation rate of 35.06%, establishing a saffron production unit on a 200-square-meter plot is not financially viable within a seven-years. (one year for construction and six years for operation). However, for plots with areas of 1000 and 5000 square meters, the internal rate of return is 36.85% and 53.99%, respectively, making them financially viable. According to the project ranking test, increasing the plot area for saffron production under controlled conditions leads to higher financial profitability. Furthermore, based on the sensitivity analysis results, it was identified that increasing product sales income has a more significant impact on project profitability compared to reducing fixed and variable costs. Positive steps such as increasing production, effective marketing, and improving product quality can enhance profitability.