ADOPTION OF NEW TECHNIQUES AND REMOVAL OF VINEYARDS
The basic objectives considered in this study are as follows: determination of a time production function, representative of the mean productions from a large area and, starting from this, implement the calculation of optimum age for replacing grapevines, profitability in the present conditions and, finally, checking the viability of restructure.
The comparison of the internal rate of return (I.R.R.) values obtained under technical and economical conditions of the production function over time, with alternative situations in which there is a change in the technique, provides the hint of whether a restructure is viable or not.
With the analysis of the mean accumulated production function, the optimum lifespan of the vineyard appears to be 46 years. The same method applied to the mean accumulated profit functions has given the following results: for a price of 20 pta./Kg for grape, the optimum lifespan is 43 years, and 45 years if the price is 25 pta./Kg.
With current prices, the profitability is very low for the most part of plantings. The application of I.R.R. has already given obsolescence levels that could be more significant in the coming years.
It has been ascertained that the usefulness of introducing the time opportunity costs and of I.R.R. in the management decision to establish the termination of the productive period in vineyards, or the suitability of a restructure. Both analytical techniques are complementary.