Economic Analysis of Grazing Practices Along Magat Watershed in Northern Philippines

by Open Science Repository Agriculture
(February 2014)


The current economic analysis, long term cost and external cost of grazing systems in the three provinces of Northern Luzon, Philippines were updated. Economic analysis using simple economic analysis, net present value (NPV) and payback period (PP) showed that continuous-silvipastoral grazing system is more economically viable than continuous-conventional system. All things being equal, the study shows that continuous-silvipastoral system seems to be the better of the two grazing systems in this region of study.

Universal Soil loss Equation (USLE) was used to determine the long term cost. Analysis showed that continuous-silvipastoral system resulted in a higher soil erosion rate with 128.73 t/ha/yr as compared with lower erosion rate of 40.68 t/ha/yr of the continuous conventional system. Several factors have contributed to this, among others: the slope, stocking rate and area covered by the grazing systems.

External cost is largely contributed by the continuous-silvipastoral system with a larger (48.61 m³/ha/yr) amount of sediments compounded to the lower (9.97 m³/ha/yr) amount from the continuous-conventional grazing system. Based from NIPPON KOI Co., Ltd study (2004) and NPC (2003), continuous-conventional grazing system can reduce the life span of the Magat dam by 0.88 years per year of grazing. Likewise, continuous-silvicultural system can potentially reduce the life span by 4.29 years for a period of one year grazing practice.

Combined the total effect of sediment discharge brought about by the different grazing systems existing within the watershed shortens the service life of the Magat Dam by 5.17 years per year of grazing period.

Keywords: Grazing System, external cost, net present value (NPV), payback period (PP), universal soil loss equation model (USLE), Magat Watershed, Pasture Lease Agreement (PLA), IDRISI, Geographical Information System (GIS).

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Economic Analysis of Grazing Practices Along Magat Watershed in Northern Philippines

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