Profitability and Resource use Efficiency of Dragon fruit (Hylocereus spp.) Farming in Karnataka: A Data Envelopment Analysis Study

Abstract

Aims: The present study aimed to evaluate the profitability and resource use efficiency of dragon fruit farming in Karnataka using Data Envelopment Analysis (DEA) and to identify the sources of technical and scale inefficiencies affecting farm performance. Study Design: A cross-sectional analytical study employing an input-oriented Data Envelopment Analysis framework. Place and Duration of Study: The study was conducted in four major dragon fruit-growing districts of Karnataka, namely Tumakuru, Chitradurga, Bengaluru, and Chikkaballapur, during the agricultural year 2023–24. Methodology: Primary data were collected from 180 respondents, comprising 80 dragon fruit farmers, 40 intermediaries and 60 dragon fruit consumers, through personal interviews using a structured interview schedule. Profitability was assessed using cost and return analysis along with investment appraisal indicators. Resource-use efficiency was estimated using input-oriented Constant Returns to Scale (CRS) and Variable Returns to Scale (VRS) DEA models. Scale efficiency, input slack analysis and returns-to-scale classification were employed to identify sources of inefficiency. Results: The establishment cost of dragon fruit cultivation was ₹3,54,249 per acre, while mature orchards generated an average annual net return of ₹4,04,364 per acre with a Benefit-Cost Ratio of 1.98, Net Present Value of ₹14,81,631.94, Internal Rate of Return of 47%, and a payback period of 3.75 years, indicating high economic viability. The mean technical, pure technical, and scale efficiency scores were 0.78, 0.88, and 0.84, respectively. Most farms (71.25%) operated under increasing returns to scale, with human labour and fertilizer identified as the major inefficiently utilized inputs. Conclusion: Dragon fruit cultivation is a profitable and economically viable enterprise in Karnataka. Improving resource-use efficiency, particularly labour and fertiliser utilisation, can further enhance farm productivity and profitability.