Profitability and Resource Use Efficiency of Producing Dry Chillies in Karnataka

The present study was conducted in the Raichur and Ballari districts of the North eastern Karnataka region since they are among the most productive in terms of dry chilli crop acreage and production. The study revealed that farmers realised a gross return of ?329760.00 per acre, with an average yield of 22.05 quintals and an average price of ?14950.00 per quintal. The cost of production of dry chilli per acre was ?5087.95. Net returns on total costs were ?217570.48, while net returns on variable costs were ?248259.24. Dry chilli producers earned ?2.9 for every rupee spent in the study region. Increasing returns to scale were noticed in both the Raichur and Ballari districts. Overall, the research region exhibited increasing returns to scale, with a proportional increase in dry chilli gross value when variable factors were accounted for. The ratios of Marginal Value Product (MVP) to Marginal Factor Cost (MFC) for farmyard manure (FYM), fertilisers, human labour, and bullock labour were found to be less than unity, indicating overutilisation of these resources. Conversely, the MVP to MFC ratio for land, seeds, plant protection chemicals, and machine labour was greater than unity, suggesting that there is scope to increase the use of these inputs—particularly land area, seeds, plant protection chemicals, and machine labour in dry chilli cultivation in the study area.