Commercial coconut farming as agribusiness investment in sub-Saharan Africa: empirical evidence of financial viability from Ghana’s Jomoro district

Purpose Perennial tropical cash crops in Sub-Saharan Africa attract significant policy interest yet suffer from a systematic absence of formal investment appraisal evidence. This study evaluates the financial viability and risk profile of establishing a 100-acre commercial coconut farm in Ghana’s Jomoro District, the country’s preeminent coconut-producing zone, generating replicable evidence to inform investment decisions, development finance targeting and agricultural sector policy across emerging economies. Design/methodology/approach A mixed-methods investment appraisal framework integrates primary data from 23 structured key informant interviews, spanning farmers, input suppliers, equipment dealers and export agents with secondary macroeconomic data from the Ghana Statistical Service, Bank of Ghana, Food and Agriculture Organization (FAO) and Ghana Commodity Exchange. Five analytical techniques are applied: net present value (NPV), internal rate of return (IRR), benefit–cost ratio (BCR), simple and discounted payback period, and multi-scenario sensitivity analysis across revenue and cost perturbations of ±10% and ±20%. Findings At a 25% discount rate, the project yields a positive NPV of GH₵5.07 million, an IRR of 38% and a profitability index (BCR) of 1.66, all substantially exceeding the cost-of-capital hurdle. The simple payback period is 5.3 years (discounted: 6.3 years). Despite cumulative pre-production losses of GH₵6.10 million during the four-year moratorium, the farm transitions to sustained profitability from Year 1, with net margins rising from 39% to 56% by Year 5. Sensitivity analysis identifies revenue volatility, not cost escalation, as the dominant risk driver. Research limitations/implications The analysis is grounded in 2025 price levels for a single agro-ecological zone. Future research should extend this framework to smallholder scales and across Ghana’s multiple coconut belts, and should incorporate climate risk modelling and longer-horizon projections that capture the full productive life of the palm. Social implications The 100-acre commercial farm model generates an estimated 31 permanent and 50 seasonal farm-level jobs, derived from the labour cost parameters in the financial model. The intercrop system further supports commodity exchange market participation. The study provides a financial foundation for designing inclusive investment models, including outgrower schemes and cooperatives that extend these benefits to smallholder households. Originality/value Based on a systematic review of the perennial crop investment appraisal literature, this study addresses a critical regional evidence gap by providing the first comprehensive formal investment appraisal of commercial-scale coconut farming in West Africa. The concurrent treatment of debt service dynamics, intercrop revenue modelling, year-by-year moratorium discounting and multi-scenario sensitivity analysis under Ghanaian macroeconomic conditions constitutes a methodological contribution directly transferable to comparable perennial crop investment contexts across Sub-Saharan Africa.