Prado-Martínez, José V.

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    Análisis de viabilidad financiera de una planta de irradiación de alimentos en Puerto Rico
    (2017) Prado-Martínez, José V.; Jiménez-Maldonado, Alwin J.; College of Agricultural Sciences; Barragán Arce, Mario J.; Román Paoli, Elvin; Department of Agricultural Economics and Rural Sociology; Plaza Delestre, María L.
    Irradiation is one of the emerging technologies identified in the short, medium and long term to conserve food. For example the use of irradiation of food provide opportunities, to reduce phytosanitary barriers, increase quality generating new market opportunities for local farmers on the island. In this study, a two-stage financial evaluation was carried out for the purpose of using cobalt irradiation system 60 and X-rays to increase the shell life of fruits and vegetables. The methodology used was to acquire the investment and operating costs of both irradiation methods. This was achieved contacting experts in the field and suppliers, to adjust and update costs. Potentially determine the demand for irradiation services that make feasible the implementation of an irradiation plant in Puerto Rico. The project, is establishes with an average of 15,000 tons (fruits, grains, grains), with future options to exceed 40,000 tons. The use of traditional financial tools such as net present value (NPV) and internal rate of return (IRR) were included as outputs variables in the model. Also a sensitivity analysis was used to identify the most relevant variables. Frequency distributions were calculated to these variables using Monte Carlo simulations with 10,000 iterations, to identify risk and cash flows volatility. Once volatility is calculated for both projects, an uncertainty was incorporated in the analysis to reduce risk. The investment for cobalt 60 plant is $ 4 million and for X-rays is $ 7.2 million. For both projects, a VPN> 0 is obtained, from $ 4.8 million for cobalt 60 with a TIR of 17%, $ 1 million for X-rays with a TIR of 7%, with prices of $ 0.10 / kg in both cases. The cost of production per kg is higher by almost 50% for X-rays compared to Cobalt 60. The price and the volume of products to be irradiated are the most impactful results. It is low risk for both projects; the probability of obtaining a positive NPV is 99.8% for Cobalt 60 and 87.5% for X-rays, obtaining a volatility of 20% for both cases. The evaluation of the actual option of deferring the risk-reducing investment for two years has a low cost for both investments, $ 0.29 million for cobalt 60 and $ 0.78 million for X-rays. For the type of business to be implemented the project , It is advisable to choose irradiations with X-rays in Puerto Rico, although the investment and the price are higher, but generates greater benefits due to the characteristics of the agricultural industry.