Economic Profit Function of Honey Production in Wasit Governorate, Iraq: Evidence from 39 Apiaries, Including Large Commercial Units

Abstract

Nevertheless, beekeepers in Wasit Governorate, Iraq raise an inquiry that what are the variables that affect the profitability of honey production, and also whether the higher number of hives in the apiary would bring more economic returns. This paper develops an economic profit function per hive based on a questionnaire survey of 39 beekeepers for the 2025 season, without discarding any observation. Profit is the economic return to honey and secondary income (sales of colonies, packages, and other products) less variable inputs, labor, land rent, straight-line depreciation of all investments, and interest on capital. This recast-of-accounts raises the profit from IQD 162 thousand per hive to IQD 173 thousand, and the economic cost is composed of 51,7% depreciation and interest. Apiaries were classified as small (≤ 30 hives, n = 13), medium (31–100, n = 19), and large (> 100, n = 7). Costs tend to increase sub-linearly with output (cost elasticity=0.67, 95% CI [0.48, 0.85]), but profit per hive does not significantly differ among classes (Kruskal-Wallis p=0.33) because large-scale apiaries experience lower yields (6.9 vs. 10.6 kg per hive). An OLS estimation with HC3 robust standard errors (R-squared=0.85) indicates that price (+IQD 9.8 thousand per 1,000 hive per IQD 1,000/kg) and yield (+IQD 32.7 thousand per kg per hive) have positive effects on profit, but labor intensity negatively affects it (−116.1 for each additional worker for 10 hives); number of hives, experience, and education level do not have statistically significant effects. Huber regression, leave-one-out estimates, bootstrap intervals, and seven other scenarios yield the same conclusions. We conclude with recommendations for marketing, cost accounting, yield improvement, shared labor-saving equipment, colony renewal, and diversification, and suggest that focusing on expansion alone is insufficient.