SOIL TESTING

LABORATORY
1 Brief Description of Project
In India Fertilizer application and consumption is highly unorganized with wide variations. The NPK ratio,
which is the measure of balanced use of fertilizer, shows wide inter-state and inter-crop disparity.
Though there has been an impressive growth in the consumption of fertilizers in post green revolution
period, their indiscriminate use has been one of the reasons for declining productivity in recent years.
Studies and Evaluations have revealed that the lack of adequate soil testing facilities and related
advisories have forced the farmers to depend on unreliable sources for advice on the fertilizer
requirement, which is one reason for the unbalanced fertilizer use.

Soil test based nutrient management has emerged as a key issue in efforts to increase agricultural
productivity and production since optimal use of nutrients, based on soil analysis can improve crop
productivity and minimize wastage of these nutrients, thus minimizing impact on environmental leading
to bias through optimal production. Deficiencies of primary, secondary and micronutrients have been
observed in intensive cultivated areas.

Odisha is a state with different physiographic and agro-climatic zones. Soils are generally fertile, but
some deficient and problematic soils need proper management. The problem soils of Odisha can be
grouped into three, classes, viz. 1. Upland, low fertile, low water retentive acidic soils. 2. Low land soils
posing iron toxicity problems and 3. Coastal salt affected soils. About 2/3 rd. of the cultivated area in
the state is highly to mildly acidic in reaction. More area can be brought into cultivation if the
problematic soils are properly reclaimed and managed. As for soil fertility status is concerned nitrogen,
phosphorous & potassium content of soils of Odisha are generally low to medium and micro-nutrient
deficiencies especially Zn and B are of common occurrence. Soil test constitute the basis to assess the
type and extent of problem and the needed management to reclaim such soils. These facts clearly
demonstrate the utmost need to establish more and more soil testing labs in the State.
1.1 Objectives of Soil Testing

1. To estimate the available nutrient status (macro, secondary and micro-nutrients)of soils.
2. To assess the type and extent of problem for reclamation of problematic soils
3. To evaluate the fertility status of soils of a country or a state or a district.

By soil test summaries the fertility status i.e. available nitrogen status or available phosphorous status or
available potassium status expressed as High, Medium or Low. A soil fertility map showing such fertility
status can be prepared. The soil fertility map can be used for -

 Delineating areas of nutrient (e.g. N, P, K) sufficiency or of deficiency,

 Studying soil fertility changing pattern due to crop cultivation over a period of years,
 Determining nutrient (e.g.N, P, K) requirement for the deficient areas etc.
 To prepare a basis for fertilizer recommendation, lime recommendation or gypsum
recommendation.

2 Existing scenario
Several States including Andhra Pradesh, Gujarat, Haryana, Karnataka and Uttar Pradesh have made
commendable progress in soil testing programme in various ways such as expansion of soil testing
facilities, popularization of the programme in campaign mode, development of soil fertility maps
and use of information technology in delivering soil nutrient status and appropriate recommendation
to farmers.

2.1 Status of Soil Testing Laboratory in Odisha

Odisha has around 60 Soil Testing Laboratories which are being funded by different government
agencies. These laboratories are full filling the soil test need of the farmers. Earlier farmers were
mainly dependable on Agricultural universities for their soil testing;however, to provide the facility at
farmers door steps, the Govt has now initiated mobile soil-testing laboratories (vans) in five districts
of Odisha. viz. are Cuttack, Mayurbhanj, Sundargarh, Ganjam and Koraput.
 2.2 Existing Status of Soil Testing Facilities
Table 1: Existing Status of soil testing facilities in Odisha
Number of Soil Testing Laboratories Before the beginning of 11th Plan, there were 11 static and 1 mobile
laboratories.
Annual analyzing capacity The analyzing capacity of 12 labs was 1, 20,000 samples per year. The
capacity is being increased with establishment of new labs and
strengthening of existing labs. At the end of the 11th Plan, it is expected
that there would be 60 Static STLs and 24 mobile STLs. The projected
analyzing capacity is about 4, 00,000 samples per year.
Review of functioning The State Govt. has extensively reviewed the program and proposed its
strengthening to increase the analysis capacity from 1,20,000 samples per
year to 4,00,000 samples per year.
Constraints Shortage of scarce andqualified manpower hampers the functioning ofthe
labs. Short term hiring and out sourcing is one of theways to carry out
work. Such personshowever,would need intensive training before
undertaking the task.
Monitoring Functioning of the Soil testing labs is monitored by the Director of Agri&
Food Production. Soil testing Lab at Bhubaneswar has been declared as a
Nodal Lab that will undertake monitoring of quality in soil testing
program.
Involvement of State Agricultural The Orissa University of Agriculture and Technology (OUAT) provide

University(s) scientific and technical support to the program. It remains effectively

involved in the program.
• Already 10 lakh cards have been provided, based on last 10 years of soil
test data.
• Soil testing kits have been provided to all blocks for analyzing 200
Soil health cards samples per block. Based on such analysis, during last 3 years i.e. 2007-08
to 2009-10 a total of 96,207 soil health cards have been issued.
• With the enhanced analyzing capacity, 4,00,000 soil health cards are
expected to be issued .
Additional labs, Static and mobile are 22 static and 23 mobile labs are proposed to be established by the State
planned to be set up Govt.
Seven labs are being provided with AAS facilities for micronutrient
Strengthening existing soil testing testing.
laboratories for micronutrient • It is planned to collect 55.000 geo referenced soil samples from the
testing entire State covering all the gram Panchayats and will be analyzed for
Secondary and Micronutrients.
The process has been initiated to place core staff in the newly created
Staffing of laboratories labs (as well as filling up vacant posts in the old labs) and engaging the
supporting staff through short term hiring and out sourcing.
 Soil Fertility Map has been prepared based on last 10 years data. In
Preparation of Soil future, this practice will continue. It has been planned to prepare digital
Fertility Maps. district maps and make the same web enabled so as to cater the
requirement of farmers and other users in remote corner of the State.
• Popularization of integrated nutrient management for maintaining soil
health is a major mandate cited in the State Agriculture Policy. Farmers
are encouraged to practice INM and special assistance is being provided
to use organic manure, bio-fertilizers and soil amendments etc.
Popularizing soil test based
• There are large acidic areas in the State hence PhosphoGypsumis being
application of fertilizers including
supplied to the farmers @ Rs. 14.25 per 50 kg bag. Paper mill sludge is
demonstration and publicity.
also supplied @RS. 10 per 50 kg bag. The recommendations are soil test
based.
The use of these products will supply calcium and sulphur. These
elements are helpful in oil seed crops grown in acid Soils
Source: www.agricoop.nic.in

Admissible items and list of equipment for setting up of Soil Testing Laboratory with annual analyzing
capacity of 1,00,000 samples per annum (For analyzing NPK, secondary nutrients and micronutrients in
soils and water)

3.1 Elements to be analysed.

While carrying out the complete analysis of soil, following categories of elements are normally
determined:
a) N, P, K (Major nutrients)
b) Ca, Mg, S (Secondary nutrients)
c) Zn, Fe, Cu, Mn, B, Mo, Cl (Micro nutrients)
Besides these nutrients soil are also analysed for followingproperties
a) pH
b) ECE
c) Organic carbon

3.2 Benefits. .
The laboratory is primarily used for soil testing, This Laboratory will also provide the extension advisory
to the farmers. Along with the testing reports, the farmers will also be provided with advise and
recommendations on soil condition and the crops suitable to be cultivated in that particular soil,
methods for improving the soil health and package of practices to be followed during crop production.
People engaged in commercial cultivation of any Agri-horti crops will be particularly benefitted through
this advisory. The scientific analysis In every two years, will enable them to assess the condition of their
soil and do the necessary improvements.
In the later part this facility will also be used for manure and water testing, chemical analysis of fruits
and vegetables etc.
Project requirements

 The soil testing labs need to be located in District headquarters.

 The labs can also be housed or attached to any Educational Institutions to draw advantage of
the facilities and expertise available.
 Vocational course for students may also be taken up in such institutions on collection of soil
samples, laboratory analytical methodologies, formulation of fertilizer schedules and
maintenance of soil health.

Capacity of the Laboratory:

The laboratory has the capacity of testing around 350 samples per day. This way around 1,00,000
samples will be tested in a year. The target for testing of NPK only is 80% of the total sample and for
micronutrients it will be 20 % of the total sample.
However the capacity utilization is considered at 40%, 60%, 75%, and 80% in the first four years and fifth
year onwards it will continue to be 80%.

Equipment’s:
The equipment’s required for the laboratory are mentioned below.

Table 2: List of Equipments for Soil testing Laboratory

Name of Equipment No.

Atomic Absorption Spectrophotometer (AAS) # 1
Kjeldahal unit for nitrogen distillation(Automatic) 1
Spectrophotometer # 1
Flame Photometer # 1
Conductivity Meter 1
pH Meter 1
Nephlometer for Sulphur estimation 1
Rotary Shaker Apparatus 1
Electronic Balance 1

Analytical Balance / Top Loading balance 2

 Drying Ovens 2
Computer /Fax with appropriate software&Printer 1
Table Top Centrifuge 1
Gas and telephone connection -
Glassware
Chemicals

These equipment’s are used for determining pH, electrical conductivity, available Nitrogen, Phosphorus,
Potassium, Organic Carbon, available sulphur besides calcium and magnesium content.

Transport:
As the Laboratory is static, there is need for collecting and transporting the soil samples to the
facility. As the awareness about the facility gradually builds up in the nearby areas, the farmers would
come to the laboratory with the soil samples by themselves for testing. The trainees of vocational
course may be deputed and their services may be utilized for collection of representative soil samples as
well as transfer of them to the nearest laboratory.

Raw Material
Apart from the collected soil samples, Chemicals and Glassware are required for undertaking the testing.
These are available with leading scientific equipment and chemical manufacturers / suppliers.

Man power
One post graduate in agriculture with soil science specialization and adequate experience in soil analysis
will be the Lead Analyst for the laboratory. He will be supported by two Lab Assistants (from soil
science/ agriculture background) for preparation of samples and other laboratory works. For collection
of samples and field related works, three persons are required.

4 Techno- Commercial Parameters

The Techno-economic Parameters for the Soil testing and Soil Health Counseling Facility are as follows:
1. A team of one specialist and two Semi-Skilled workers can analyze350 samples per day.
2. Analysis work will be done for six days in a week.
3. Sample collection and report writing etc will be done simultaneously.
4. Monthly approximately 8,750 samples will be analyzed and yearly 1,00,000 samples will be
analyzed.
5. Sample collection will be done only eight months in a year depending upon cropping pattern.
Analysis can be carried out throughout the year.
6. Capacity utilization will be 40%, 60%, 75% and 80% of the installed capacity in the first three
years and 4th year onwards in that order.
7. Charges for testing would be 15/ per soil sample (for analysis of NPK) and 850/ per sample
with micro-nutrients.
8. The chemicals and glassware consumption is considered@ 7 per sample for NPK analysis and
@ 100/ per sample for micronutrient analysis.

ROAD
Chemical Store

Analysis Room
11'-4" x 8'-02'

Instrument Room
26' x 22'

22' x 12'

ROAD'
Soil Store
7'-09" x 8'-11'

Office
ENTRY

14'-06" x 10'-03'

Toilet
14'-06" x 05'-11'

Figure 1: Layout for an ideal Soil Fertilizer Laboratory

Toilet
14'-06" x 05'-00'
5 Project financials
5.1 Project Cost .
The project cost comprises of 53.65 lakh towards capital cost and 6.26 lakh for operational cost in
the first year. The detailed operational cost has been furnished in Annexure II. The operational cost in
the second, third and fourth year onwards is 11.00, 12.21 lakh and 12.61 lakh respectively.

Table 3: project cost:

PARTICULARS Total
LAND -
PLANT & MACHINERY 35.28
MISC. FIXED ASSETS 14.70
TOTAL FIXED ASSETS 49.98
NET CURRENT ASSETS
WORKING CAPITAL 6.26
MARKET DEVELOPMENT EXPENSES -
PRE-OPERATIVE EXPENSES 3.67
Total 59.91

Establishment of Soil Testing Laboratory and Soil Health Counselling Facility Cash flow
Statement. Testing fee of 15/- per soil sample (excluding micro-nutrients) and 850/- per soil
sample with micro- nutrients is considered in the model. The revenue in the first three years, and
fourth year onwards would be 41.37, 62.06 , 77.57 and 82.74 lakh respectively.

Table 4: Cash flow statement

Sl No. Item Year 1 Year 2 Year 3 Year 4 Year 4

onwards
1 Capacity Utilization (%) 40 60 75 80 90%
Income from soil sample 40 % capacity 60 % capacity 75 % 80 % 90% capacity
testing capacity capacity
2 Soil Test ( NPK) (90 %) 5.67 8.51 10.63 11.34 12.76
Soil Test (Micro 35.70 53.55 66.94 71.40 80.33
Nutrient)10%
Total 41.37 62.06 77.57 82.74 93.08
3 Expenses incurred 24.69 30.33 33.36 34.29
4 Net Income 16.68 31.73 44.21 48.45
5.2 Capital Costs for Establishment of Soil Testing Laboratory and Soil Test Lab
Table 5: Capital Cost

Sl. Items Cost (Rs. in lakhs)

1. Equipment 28.6
2. Chemicals :Glassware: Misc. laboratory articles 4.00
3. Contingencies (Stationary: Literature printing and misc.) 2.00
4. Standby Generator/Electricity source 4.00
Total 38.6

Note: Subsidy would be provided @ 50% of project cost limited to maximum of Rs.15 lakh as one
time subsidy.
Table 6: Cost of Equipments:

Name of Equipment No. Cost (Rs.in lakhs)

Atomic Absorption Spectrophotometer (AAS) 1 16.0
Kjeldahal unit for nitrogen distillation(Automatic) 1 4.00
Spectrophotometer 1 2.00
Flame Photometer 1 0.70
Conductivity Meter 1 0.50
pH Meter 1 0.30
Nephlometer for Sulphur estimation 1 0.25
Rotary Shaker Apparatus 1 0.40
Electronic Balance 1 0.70
Analytical Balance / Top Loading balance(@ 0.30 Lakh) 2 0.60
Drying Ovens 2 0.75
Computer /Fax with appropriate software&Printer 1 1.50
Table Top Centrifuge 1 0.25
Gas and telephone connection - 0.15
Motorcycle 1 0.50
Total 28.6

Table 7: Indirect Expenses:

Item Year 1 Year 2 Year 3 Year 4

S.No. onwards
1. Power, Water @ 5000 per month 60000 60000 60000 60000
2. Manpower – Soil scientist @ @ @ @ @
50,000/ pm and two Lab 1,28,000/m 1,44,000/m 1,44,000/m 1,44,000/m
Technicians @ 15,000/ pm, Two 15,36,000 17,28,000 17,28,000 17,28,000
Field Asst. @ 8,000/pm, Four
LabAsst@ 8,000/pm, Two
Security @ 8,000/pm,
3. Expenditure on Chemical and
Glassware @ 50/ per sample 7,43,000 11,15,000 13,94,000 14,87,000
4. L.P.G 1000/ per month 12000 12000 24000 24000
5. Repair & maintenance 10,000 10,000 10,000 10,000
6. Telephone @ 1000 per month 12000 12000 24000 24000
7. Travel for canvassing and collection 96,000 96,000 96,000 96,000
of samples @ 8000 per month
8. Total 24,69,000 30,33,000 33,36,000 34,29,000
9. With Annual escalation @ 10 %
Margin Money
The margin money / down payment considered in the model is 15 % of the unit cost which works out
to 8,98,650.

Bank Loan
Bank loan of 85 - 95 % of the total cost shall be available from the financing institution. Bank loan
considered in the model is 85%. It works out to 44.93 lakh in the model.

Rate of interest
Banks are free to decide the rate of interest within the overall RBI guidelines issued from time to time.
However, the ultimate lending rate has been considered as 12 % for working out the bankability of the
model project.

Security
Banks are guided by RBI guidelines issued from time to time in this regard.

5.3 Financial analysis

The techno economic parameters assumed in the model are given in Annexure III. The cash flow
statement and detailed financial analysis are shown in Annexures I & IIV respectively. The financial
analysis indicates that the scheme is viable. The major financial indicators are given below:

Table 8: Financial indicators:

KEY INDICATORS Envisaged
As per 5th Year
NET PROFIT AFTER TAX 28.20
INTERNAL RATE OF RETURN 27.67%
BREAK EVEN POINT(% of total sale) 52.52
PAY BACK PERIOD ( YEARS) 4.28

5.4 Repayment schedule

Based on the cash flow the detailed repayment schedule has been worked out and furnished
below. The repayment period works out to 7 years.

Table 9: Loan Repayment Schedule

Loan Repayment Schedule
Particular Amount
Loan Amount 44.93
Interest Rate 14%
Duration 7
Instalment 6.42
 Year Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8
Principle 44.93 41.72 35.30 28.88 22.47 16.05 9.63 3.21
Installment 1 3.21 3.21 3.21 3.21 3.21 3.21 3.21
Installment 2 3.21 3.21 3.21 3.21 3.21 3.21 3.21
Total Installement 3.21 6.42 6.42 6.42 6.42 6.42 6.42 3.21
Intrest 1 3.15 2.92 2.47 2.02 1.57 1.12 0.67 0.22
Intrest 2 3.15 2.70 2.25 1.80 1.35 0.90 0.45 (0.00)
Total Interest 3.15 6.29 5.62 4.72 3.82 2.92 2.02 1.12 0.22
Principle Paid 3.21 6.42 6.42 6.42 6.42 6.42 6.42 3.21
Balance 41.72 35.30 28.88 22.47 16.05 9.63 3.21 (0.00)
 ANNEXURE -I
Cash Flow Statement (RS IN LACS)
PARTICULARS Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
SOURCES
INCREASE IN SHARE CAPITAL 14.98 - - - - - - -
NET PROFIT - (13.58) 3.68 15.67 20.16 20.65 19.26 19.59 19.88 20.12 20.32
(INTEREST ADDED BACK)
SUBSIDY -
DEPRECIATION - 7.50 6.37 5.42 4.60 3.91 3.33 2.83 2.40 2.04 1.74
PRELIMINARY EXP.W/O - 0.37 0.37 0.37 0.37 0.37 0.37 0.37 0.37 0.37 0.37
INCREASE IN TERM LOAN 44.93 - - - - - - -
INCREASE IN WC - - - - - - - -
59.91 (5.72) 10.42 21.45 25.13 24.93 22.96 22.79 22.65 22.53 22.43
 Annexure II

DISCOUNTED CASHFLOW STATEMENT

PARTICULARS Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
CAPITAL COST -
GROSS REVENUE 41.37 62.06 77.57 82.74 93.08 93.08 93.08 93.08 93.08 93.08
PROD & OTHER COSTS 47.09 51.63 56.12 57.61 60.60 60.60 60.60 60.60 60.60 60.60
SURPLUS - (5.72) 10.42 21.45 25.13 32.48 32.48 32.48 32.48 32.48 32.48
SALVAGE VALUE 3.11
GROSS SURPLUS (5.72) 10.42 21.45 25.13 32.48 32.48 32.48 32.48 32.48 35.59
DF @5% 0.95 0.90 0.85 0.80 0.75 0.70 0.65 0.60 0.55 0.50
PW - (5.43) 9.38 18.23 20.10 24.36 22.73 21.11 19.49 17.86 16.24
DF 0.90 0.80 0.70 0.60 0.50 0.40 0.30 0.20 0.10 0.00
PW - (5.15) 8.34 15.02 15.08 16.24 12.99 9.74 6.50 3.25 0.00
IRR (17.79) 7.05 12.80 27.67%