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ECONOMICS OF PRODUCTION AND MARKETING OF
BROILERS IN ALLAHABAD DISTRICT OF UTTAR
PRADESH
SUBMITTED TO
Allahabad Agricultural Institute-Deemed University
For the award of the degree of
Doctor of Philosophy
In
Agricultural Economics
By
Hakim Shabir Ahmad
2008
DEPARTMENT OF AGRICULTURAL ECONOMICS & RURAL
SOCIOLOGY
ALLAHABAD AGRICULTURAL INSTITUTE – DEEMED
UNIVERSITY, ALLAHABAD – 211007 I. D. No. 05PHAFM001
THESIS
This manuscript is Dedicated to
Well Wishers and
Poultry Farmers
Chapter-I
Introduction
INTRODUCTION
India and its neighboring countries are ancestral home for the present day
domestic fowl. Poultry are domesticated birds that are bred specifically to provide
meat and eggs for human consumption. Poultry has been produced in India for over
5000 years, but most of the scientific knowledge of poultry husbandry has resulted
from research done within the past 50 – 60 years. Poultry keeping in India has for a
long time remained largely a rural cottage enterprise and received less care and
attention but now it has been recognized as a profit oriented venture due to its high
economic returns during a short span of time. Poultry keeping is one of the important
subsidiary farm occupation in the rural areas in India providing additional income and
job opportunities to farming community in rural and labour force in Urban areas.
Poultry production in India has made rapid progress in last three decades which is
envisaged from the fact that the estimated 27 billion eggs produced in India in 1991
represented 12 fold increase as compared to 1961.Broiler production which was only
4 million kg’s in 1971 was 250 million kg’s in 1991, which shows almost 60 fold
increase in these 20 years and at present the figures are much higher. This increase in
poultry production also created employment for about 1 lakh farm workers.(Source:
Poultry industry year book 2004) At present the annual output of eggs is likely to
increase 40 billion and broiler production to 400 million kg’s during the current period
(2005-2006).
Poultry keeping can be flourished more by applied research, creation of
infrastructure and on facilities for providing adequate number of trained personell. At
present India ranks 9th in poultry production and 5th in egg production in the world.
Indian poultry has emerged as one of the most important animal/ agricultural sector
over the last three and a half decades. As a matter of fact it has now been increasingly
realized that poultry farming can prove to be one of the best kind of industry / job by
which the evils of the society like malnutrition and unemployment can be eradicated
and beaten effectively. Further it is on the threshold to play a very important role as an
instrument of social change.
Broilers are defined as young chickens about 5 - 6 weeks of age, which have
been raised specifically for meat production. Broilers are bred for poultry meat
production. They get the name broiler from the broiler houses in which they are bred.
Broilers are only 5 – 6 weeks old at the time of slaughter. Broilers were not so popular
in our country about 30 – 35 years back as they did not got consumer’s acceptance,
but today the broiler farming in India has taken a stride for rapid development mainly
because of gradual change in the food habits of our people, increase in the purchasing
power of wider section of people, rise in income and also due to shortage of other
forms of meat such as mutton, beef, fish etc. etc.
Broiler meat when compared to other forms of meat has higher protein content,
lesser fat and fiber. Broiler meat composition is given in table 1.1.
Table 1.1: Composition of broiler meat
S.No. Particulars Percentage
1. Water 71
2. Protein 19
3. Fat 5
4. Other like minerals 5
Source: Poultry Industry yearbook 2004
Calcium, phosphorous and iron constitutes are present in 12, 20 and 19 mg
respectively in 100 gms of broiler meat. It has rich content of lipids, vitamins and the
energy supply is 300 calories per 100 gms of meat. Even after five decades of
independence the per capita consumption of animal protein food like milk, meat, egg
and fish are far below the national target as fixed, due to poor purchasing power and
lack of know how about the balanced diet. Also the reason for this is high incidence of
vegetarian population Now, it can be rightly envisaged that with the awareness and
consciousness about health and change in food habits of people the consumption of
animal protein food is sure to increase more so in respect of broiler meat. The
consumption is sure to increase because of it being cheap as compared to mutton and
fish and also broiler meat is considered to be tastier.
Broiler farming is possible in widely different agro-climatic environment, as
the fowl possesses marked physiological adaptability. Requirement of small space,
low capital investment, quick returns from investment and well distributed turnover
throughout the year make broiler farming remunerative in both rural and urban areas.
The rearing of broilers provides an excellent opportunity for gainful employment to
idle or under employed members of rural, semi urban and urban families. This
industry readily adopts itself to a full time or part time occupation particularly for
women, children or elderly people. A sizeable supplementary income may be obtained
from poultry products even though the individual producer may have other
employment. Amongst farm animals, poultry is one of the quickest and most efficient
converters of plant products especially low fiber feed stuffs, which are not used for
human consumption, into highly nutritious, protective animal protein food. Poultry
litter, if properly collected as in the deep litter system has a high manurial value
containing higher percentage of nitrogen and phosphorous than manure from other
livestock. Broiler industry can be a complementary enterprise, because a ton of
poultry manure can supply the required fertilizers needed under irrigated conditions
for about two acres of wheat or sorghum or for about one acre of paddy or maize, or
for about half an acre of vegetables or for about one fourth acre of sugarcane. To
produce this the birds occupy less than 20 sq. yards of space but supply fertilizers for
1000 and up to 10,000 sq. yards according to the type of crops.
The first and the foremost attempt in commercial broiler production in India
took place during 1959 in Hyderabad under the supervision of Dr. Earl Moore a
U.S.technical cooperation Mission poultry expert, through Kansas State University,
United States Agency for International Development programme. At that time 4500
white rock day old chicks were imported form Israel and reared at Osmania
Veterinary College, Hyderabad. In mid sixties 10,000 broiler chicks belonging to
seven different fast growing strains were imported from Australia. Over two million
chicks were produced upto 1971. However until 1975 the Indian poultry Industry was
mainly age oriented and the broiler production remained as supplementary to egg
production and seasonal in nature as well as operation. During late seventies and early
eighties consumers realized the deliciousness of broiler meat and thereby demand for
broiler meat began to creep up & demand increased to many fold.
In order to save foreign exchange and prevent the danger of spreading new
poultry diseases from abroad the Government of India decided to develop commercial
broiler strains indigenously. This had lead to the starting of All India coordinated
research projects on poultry breeding during 1970 – 71 with several breeding centers
all over India with the objective of developing a commercial hybrid broiler suitable
for the local climatic conditions and capable of attaining a minimum body weight of 1
kg with feed conversion efficiency of two to six weeks of age. India is perhaps the
only country in the developing world that can boost self sufficient breeding capacity
with sophisticated S.P.F. (Specific pathogen free) technology and full-fledged
research operations combined with training facilities comparable to the best in the
world. The first commercial broiler released which is purely of Indian origin and
developed without any foreign assistance was B-77 from Indian veterinary Research
Institute. Izzatnagar, UP. During 1977 Later 1BL-80 from Punjab Agricultural
University, Ludhiana and 1BB-80 from University of Agricultural sciences Bangalore
were released during 1980. Later several commercial hatcheries in collaboration with
foreign poultry breeder have released commercial broilers with trade names of Ross,
Indian river, Cobb, Lohmann, Hybro, Marshal, Peterson etc. Broiler production is
increasing day by day, month by month and year by year. The following statistics
show the many fold increase in broiler production
Table 1.2: Broiler production in India (in millions kg’s)
Year 1971 1977 1980 1985 1991 2001 2004 2005(proj)
Production 4 17 30 75 250 350 450 500
Source: Poultry Industry Year book 2004
During the last decade or so poultry industry especially broilers in India had
galloped at rapid rate and recorded tremendous increasing results. India is expecting a
big leap in broiler production towards 21st century. Broiler meat consumption is
increasing every year compared to other meat. Many delicious delicacies are made out
of broiler meat like chicken korma, chicken tandoori, chicken Manchurian, chicken
kebab and much more which are well accepted by consumers.
Marketing of poultry and poultry products is one of the sensitive areas of the
industry, which allows the producer to think whether to continue or close up the
activity. As it is rightly said that it is easy to raise a crop or animal product but the
uphill task before the producer is that it should be satisfactorily marketed. The poultry
industry engages in extensive market development and demand expansion
programmes. The growth of the processed egg product industry and the development
of further processed poultry meat products are examples. The rapid growth of fast
food chicken industry has also influenced poultry markets. The industry’s recognition
that consumers desire a younger, smaller and more tender chicken than was produced
as a by product of the egg laying flock, and the resulting expansion of the broiler
industry, is a classic example of the marketing concept and industry market
development. Most of this market development was sponsored by processors and the
fast food industry.
Presently the serious problem of Indian broiler industry is marketing. The
marketing of a product comprises of selling, advertising and public relations
assessment of consumer needs, marketing research, product development and
planning, pricing and distribution. If the marketer identifies them and promotes them
effectively goods will have an easy outlet. The demand for broilers meat is influenced
by many seasonal factors which may increase or decrease the demand. Broiler’s are
marketed either live or dressed. The loss due to the dressing in converting live weight
to dressed weight is around thirty percent.
Landless labourers often derive more than 50 percent of their income from
livestock, especially poultry. The value of output from poultry sector is nearly Rs.
15,000 crore, and the sector provides direct or indirect employment to over 2 million
people. With output to 45 billion eggs in 2004-05, India ranks among the top five egg
producing countries in the world. Further more, poultry today is one of the fastest
growing segments in the economy. (Source: Economic survey 2005-06 page 158).
India is on the 9th rank in chicken meat producing countries in the world (FAO
data 2004, provisional). Around 1.65 MT of chicken meat was produced in 2004. For
poverty alleviation, nutritional nourishment and gender empowerment, government is
promoting the development of the poultry sector, particularly of the rural backyard
variety. Under assistance to state poultry farms a centrally sponsored scheme, the
North Eastern States are being provided with 100% financial assistance, while the
other states receive 80% of the funds requirement. (Source: Economic survey 2005-06
page 159.)
Recently with the spread of bird flu disease some setback was done to poultry
industry which is slowly and steady coming back on track. The price slashed steeply
and chicken menu was withdrawn from fast food junctions and restaurant owners from
their recipe due to outbreak of bird flu.
Allahabad district having population near to five million is situated to south east part
of Uttar Pradesh. Allahabad city is one of the oldest and historic cities of India. A large
portion of people have non-vegetarian food habits, thereby increasing the demand for
broilers, moreover due to high cost and non-availability of other meat products. Allahabad
Agricultural Institute-Deemed University situated at Trans Jamuna region of Allahabad had
firstly established broiler enterprise about four and half decades back under the supervision of
Canadian expert Mr. Jim Gill. The Department of Animal Husbandry of the Institute also
offers a training course for poultry management. The broiler production of the Institute
created awareness and interest among the locals and other people of adjoining areas in the
broiler production as it is remunerative enterprise.
Justification and importance
Broiler production is showing increasing trend day by day. Entrepreneurs are
adopting this enterprise due to its being highly remunerative and profitable. For
poverty alleviation, nutritional nourishment and gender empowerment, government is
promoting the development of poultry (Broiler) sector. Government is also offering
subsidies to poultry farm owners through centrally sponsored schemes. The problem is
also justified as the broiler meat is finding its place in every kitchen due to its being
tastier and cheaper than other forms of meat.
A thorough study into the production and marketing will be useful to the
rearers so that they can look forward for necessary changes in the production patterns
and marketing practices of the broilers, which are still reared on traditional methods.
The broiler farm owners will go on scientific lines as this study will locate the
bottlenecks in traditional methods. Marketing results may be useful in examining the
existing marketing system and in knowing the bottlenecks related to the marketing of
broilers so that suitable suggestions can be communicated to curb the existing
problems.
The results of the study may also help government agencies, policymakers,
credit institutions, co- operative societies, marketing agencies, traders and other
private agencies etc to take measures regarding the production, trade and marketing
practices of broilers. It will also help further research pertaining to poultry industry.
Also, the work shall be of academic utility and may show some guidelines for
the extension workers of the study area.
Objectives
1) To work out the costs and returns in broiler production in different size groups.
2) To evaluate the measures of farm profit in different size groups.
3) To study different marketing channels involved in the marketing of broilers.
4) To find out the producer’s share in consumer’s rupee, price spread and
marketing efficiency in different channels of marketing.
5) To study the problems faced by the broiler rearers of the selected area and
suggest suitable measures to curb them.
Hypotheses
1) Large sized farm owners have relatively higher cost of production as compared
to medium and small sized farm owners.
2) Small sized group farms have relatively higher profit than the small and large
sized group farms.
3) Producers share in consumer’s rupee is more in direct channel (Producer-
Consumer) as compared to other channels prevalent in the study area
Limitations
1) The collection of the data was entirely based upon the memory of the
respondents.
2) It was very much difficult to extract information from respondents as they use to
give information in their own dialect, which was also painstaking for researcher
to obtain correct information
3) Since most of the broiler farmers do not keep updated records and accounts, so
the data collected entirely depended upon their remembrance and experience.
4) Some entrepreneurs were reluctant to give correct information for the fear of
being taxed by the government, so they would take strangers/investigators
enquiring about their enterprise as government agents and alike.
5) Some entrepreneurs were hesitant in allowing investigators/ researchers in
having frequent visits on their farm.
6) Resources available with the investigator were limited, which was also a
limitation in enlarging the study area
Chapter-II
Review
Of Literature
REVIEW OF LITERATURE
The present problem selected for the study “Economics of Production and
Marketing of Broilers in Allahabad District of Uttar Pradesh” is a neglected one so
far. Some isolated and independent investigations as well as case studies regarding its
different aspects were attempted, but not a complete study on production and
marketing was done so far. It is also always desirable to analyze the research work
already conducted in particular field for the systematic development of science.
Therefore, it was felt necessary to retrospect the research work already done related to
economics of broiler farming.
To make the study about economics of production and marketing of broilers in
Allahabad district more rational and useful a brief review of research findings done by
different researchers is given below.
Johnes and Henson (1975) conducted a study and showed many similarities in
performance and some difference in individual cost items in producing broiler in the
South and North East USA. From mid 1972 through 1974, costs averaged about 22.5
cents per pound of saleable live weight, feed accounted for 72-74% of total costs,
chicks for over 12 percent and grower payment for 10-12 percent costs vary widely
between months and within regions.
Nemati (1976) reported that profitability of poultry keeping in Hungary varies
from farm to farm. Some 60-65% of costs are for feed, and the study investigated the
timing of feeding, the rationalization of feed structure and its effect on the efficiency
of broiler production. Optimal feeding can result in saving of 0.05 -0.1 kg feed per kg
of poultry meat. This would be equivalent to a saving of 10-15 thousand ton of maize
a year in Hungary and could improve the profitability of broiler.
Richardson (1976) conducted a research and enlighted some light on
production, marketing and consumption in United Kingdom broiler industry.
According to the report consumption of chicken has risen from 1 million in 1950 to
300 million in 1975. The report draws detailed material on production, consumption
and changing structure of the industry.
Ahmed (1977) conducted a study for calculating the cost of broiler production
in Vidarbha agro-climatic condition in three lots of broiler. The total cost per broiler
worked out to be Rs 8.41. The recurring (variable) and non-recurring (fixed)
expenditure per broiler was Rs 7.27 and Re 1.14 respectively. This worked out to
86.94% and 13.56% of the total cost. The cost of chicks and feed accounted for 90%
of the recurring expenditure. The monetary return per broiler was Rs 10.10 at the
selling rate of Rs 8.00 per kg of live weight.
Al-Hassan, McRae and Hulan (1981) studied energy costs, investment costs,
and the overall costs of production of chicken and turkey broilers have escalated in the
past decade. Poultry scientists at the kentville research station in Nova Scotia have
identified some areas where costs can be reduced by sound managerial practices. A
major study area has been the effect of reducing floor space per bird below the
suggested or cost of production average floor area of 0.8 ft 2 per chicken broiler and
2.33 ft 2 per turkey broiler.
Sewak and Dhillon (1983) reported that cost and return structure of poultry
business had undergone by change due to the severe inflationary trend in the Indian
economy, since cost of feed comes around 75 per cent, cost of chicks 17 per cent, of
labour cost 4 per cent and miscellaneous cost 4 per cent. As far as the cost structure
for different categories of farm i.e. category I, II and III was concerned the total cost
per bird per year turned out to be Rs 60.67, 60.56 and 53.70 for small, medium and
large farms respectively.
Patil (1985) studied by means of benefit cost ratio that broiler production can
be a profitable enterprise in India. Since feed is the major cost item, profitability can
be improved by proper feeding management, well balanced diet should be prepared by
cheaper and easily available ingredients.It was concluded in the study that feed
accounted for nearly 65 per cent in the total cost.
Pandey and Tewari (1985) conducted a study to assess the profitability of
commercial egg and broiler production and attempted to determine the minimum
economic size of commercial layer and broiler unit and there financial feasibility and
to identify the constraints in poultry development. Unplanned expansion of broiler
farms and increased production cost and marketing problem are major constraints of
broiler production.
Prasad (1986) conducted three experiments on 100 broilers from day old to 10
weeks of age at three different climatic conditions on the performance of broilers.
Three periods of the year was selected as (I) September – October-November (II)
February-March-April and (III) April –May-June and broilers were reared at standard
ration. The body weight gain, feed grain ration, mortality rate and cost of production
were estimated for 10 weeks. It was concluded that the broiler production is
economical during September –October November as well as February-march –April
as compared to hot climate conditions that is during April –May- June.
Popioick (1987) conducted a study in 14 farms situated in cooperative within
the Lublin regions of Poland and he analyzed overheads in broiler production. The use
of raw material cost, variable costs or the value of the total gross production as a basis
for the calculation of fixed costs is reviewed. Overheads incurred from individual
production cycles can be calculated more precisely by incorporating data regarding
chick number and fatteny rates in the cost analysis. Due to the specific production
structure of chicken broiler farming the use of material costs values as a basis for
calculating indirect costs is seen as highly appropriate.
Yanakieva (1987) reveals that change in the economic performance of broiler
rearing in Bulgaria are outlined along with the influence of important factors over the
1976-84 period. Results indicate that when the level of intensification in production is
raised, economic performance decreases as a result of the rise in prices of raw
materials of industrial origin. With these prices and prices of broiler meat is not
profitable.
Gates and Timmons (1988) conducted a study and showed a methodology for
economic optimization of broiler production can provide an environmental control
strategy that will select inside temperature as outside temperature, and bird age
change. Their environment can be optimized on either a per unit weight basis or on a
per bird day basis. The system can be used for any type of housing. As parameter
prices change e.g. fuel or feed costs the optimum inside temperature may shift and this
can be computed by broiler economic optimizing system.
Shingal et al. (1988) showed the importance of feeding value of Gulli danda
seeds in broiler diet. Gulli danda (Phalaris minor) is widely available weed which was
unknown in agricultural field a decade ago has very extensively spread at the present
time in wheat rice rotation fields. The investigation were divided into two parts(1) in
the laboratory and (2) at the poultry farm. Comparison of chemical constituents in
gulli-danda and maize seeds indicated that they are chemically comparable so far as
dry matter, crude protein crude fat and metabolizable energy are concerned. At the
poultry farm experiments higher body weight gains were obtained in the group of
birds fed with gulli- danda seed compared to those fed with maize.
Rajendra Prabhakaran and Subramania (1988) reported in their study that
seasonal index for broiler prices were highest in January (108.32) and lowest in
September (93.76). The high price in November, December and January could be
partly attributed to the increased demand during festivals like Christmas, New year etc
and low price in September was because of the religious restrictions of eating non-
vegetarian dishes. In summer months (March, April, May) broiler prices fall because
both production of chicks as well as consumption of broiler were less.
Chhikra and Chidha (1989) recorded that the cost and returns structure of the
poultry enterprises has undergone a big change due to the severe inflationary trend in
the Indian economy so far as costs are concerned the major items of costs such as feed
(70.12%), cost of day old chicks (6.82%), labour cost (2.24%) and interest on variable
cost and fixed cost (1.73%) and (5.42%) respectively. In cost structure, the total cost
per birds per year calculated are to be Rs 104.38 Rs 92.41 and Rs 88.52 for small,
medium and large farms respectively. It shows that cost on large farms are
substantially lower than the small and medium farms. This due to superior
management skill, use of better genetic stocks and the economic of scale. Gross
returns were also found to be highest for large farms followed by medium and small
farms.
Dagaas (1989) stated the relative production performance and the economic
profitability of raising 5 broiler strains at 6, 7 and 8 weeks of age and marketing them
at different forms such as live, dressed or cut up parts were studied. Parameters used
to determine the production performance of the broilers were body weight, feed
consumption, weight gain, feed efficiency, mortality and carcass yield. Results
showed that strain was found to have significant influence on all the production
parameters except on mortality.
Rahmatullah (1989) studied that poultry faming has become very popular.
Broiler rearing is much more profitable than layer farming and the return in case of
broilers in quicker. In his article Economics of broiler rearing, he has found that the
farmers have initial capital expenditure of Rs 10,0000 in establishing the farm. The
construction of one poultry house (1000 sq.ft.) was Rs 12,500 and the equipments and
fittings etc. Rs 2,500. In this study the capital investment was not taken into
consideration since the farmers were rearing 1000 broilers within 60 days.
Considering the maintenance cost of broiler rearing, the farmer gained an over all
profit of Rs 700 in 60 days for 1000 broilers. The average returns was Rs 2.70 per bird
in commercial farming.
Timmons, Bottcher and Scheideler (1990) an expert system was developed to
analyze the effects of various design and management options to reduce heat stress
and /or increase economic returns in broiler housing. Returns are given in terms of
their expected values and an expected range in 7 yrs.
Safley and Safley Jr (1991) stated that poultry is the main agricultural industry
in North Carolina, USA. The majority of broilers and turkeys grown are raised in
confinement housing and different bedding materials include wood shavings, sawdust
and peanut hulls. The litter from the houses in rich in nutrients and can be used as an
organic fertilizer on cropland or as feed ingredient. This study estimates the land,
equipment, labour and cost requirements associated with operating six model compost
facilities. Cost estimates were based on 1989 prices. Differences between the systems
are discussed.
Kim (1991) reported the analysis concentrates on structural changes on
different sizes of chicken farms and uses a Markov model analysis. Of the farmer with
less than 5000 broilers, between 35% and 10% survived the transition period 1980-95,
while for farms with over 30,000 chickens 14% to 35% remained in business. The
profitability of survival for farms with 5000 to 30,000 chickens was 51% to 57%
during the same period. The optimal size of a broiler chicken farm with one person of
labour input is 3333 chickens and these farms average 1.6 million won (US $1964.40,
1US $ 814.50 won, October 25,1996) income. The consumption of chicken meat has
been increasing as GNP per capita has risen. However, the level of producer price per
kg has not increased at the same rate as labour and feed costs during this time period.
Panday and Aggarwal (1992) reported the analysis of monthly and annual
broiler and feed prices in India for the period 1980-88 show that, in general, broiler
prices were relatively higher in colder months than in warmer months. By contrast
feed prices registered an increasing trend during summer and a declining trend in the
winter season which shows higher profitability to producers during winters and less
profitability in summers. In contrast other heating charges will go up in winters which
are very less in summers. Variability (28%) in broiler prices was highest in August
and lowest (15%) in May. Feed prices observed the highest variability in March (21%)
and lowest in October (15%). Both broiler and feed prices significantly increased
between years and months. Broiler prices increased at the rate of 6% - 7% per annum,
in different seasons broiler prices increased by about 18% in September and feed
prices by 8% in August. Broiler prices declined by 13 pecent in June and feed price by
6% in January. The parity indices for broilers and feed prices observed a mixed
situation over the period and across months. To maintain price parity, the study
recommends either the creation of cold storage facilities or encouragement of
consumers to consume broilers in summers.
Mian, Akbar and Barman (1992) observed than poultry is an important
source of animal protein. In Bangladesh poultry is produced in a backyard subsistence
method and the existing poultry marketing is reportedly inefficient. This study was
conducted to analyze the problems of marketing poultry in some selected areas of
Mymensingh district. Findings reveal that poultry birds are marketed through the
channel: producer-Biopary 1 Aratdar 2 Retailer- consumer. The intermediaries faced
various problems in running their business. The study shows that marketing cost per
50 kg birds was Taka 263.36 in which transportation accounts for the highest cost
whereas, the profit earned by them was not encouraging as compared to the marketing
cost. Despite low profit, poultry marketing seemed to be more or less efficient.
However, since the marketing channel was long, the consumer had to pay a high price
and the producer was deprived of fair returns.
Kolic (1994) indicated that main factors in determining the profitability of
poultry farming enterprises are income, cost and price of the component. Important
factors for total income are weight and quality at delivery, feed conversion and bird
mortality rate. Cost and price factors include personal earning, labour, technical
equipment, average number of birds and production system. Larger farms have better
production as well as profit results.
Heru (1995) did study which described the linkage between corn markets and
poultry market. Specially, this determines the behaviour of supply and demand for
dressed broiler chicken and egg, analyzes the dynamic system of integrated corn and
livestock markets in terms of stability condition and long run multiplier, and used this
for policy analysis on fertilizer subsidy phase out.
Gajendra and Sadagopen (1996) studied that since feed is the major item of
cost in producing meat and egg, favourable feed efficiency and avoidance of feed
wastages indicates a sound poultry farming system. An economic feeding with
nutritious balanced ratio maintaining all technical and managemental practice bring
about poultry a profitable venture.
Kitsopanidis and Manos (1996) stated that the most important factors for the
economics of poultry meat production are mortality and age of final live weight
(FLW) of broilers, because they affect the total feed consumed and the total FLW of
broilers achieved. Analysis of these factors showed that an increase of mortality from
2.5% to 10.0%, and the age of FLW of broilers from 53 to 62 days leads to a decrease
in profitability by 96.7% and 77.7% respectively. the marginal analysis showed that
under the economic conditions of 1990, the best day for selling broilers is the 51st
while under the economic conditions of 1994 this day is the 49th or 50th.Also the use of
the decision tree technique showed that the actual gross returns per broiler is lower
than usual by 2.5% -2.6%.
Shanmugam and Mohan (1997) did the study of economic analysis of broiler
production in kamarayar district of Tamil Nadu revealed that Rs. 27.10 per broiler was
invested to start a broiler farm. The total cost of broiler production per bird was Rs.
22.18 of which variable and fixed costs constituted 93.24% and 6.76 % respectively.
Cost of feed alone accounted for more than 50% of the total cost followed by cost of
chicks, about 25%. There is wide scope to reduce the total cost by substituting the
least cost farm mixed rations. Amount realized by sale of broilers formed the major
source of return (96.21%) in broiler enterprise. The net return per broiler and per kg of
live weight of broiler produced were Rs. 5.51 and Rs 3.01 respectively. Benefit cost
ratio was 1.25:1 in the present study. Break even analysis revealed that at least 127
broilers must be reared by the farmers to cover the cost of production. The economic
analysis also proved that the entire investment could be repaid in one year which
reflects the economic viability of the broiler farms located in the study area.
Mugga (1997) reported the production and consumption trends in the Ugandan
poultry meat. Over the past five years broiler meat production in Uganda has
increased by around 25% per year. Consumption has increased by the same
percentage. In spite of this both remain low relative to neighboring countries. Topics
covered include increasing scale of operations, the need for marketing, production
methods, import of chicks and industry performance.
Tupy and Shirota (1998) research estimates the economic efficiency (cost
efficiency) in poultry production of companies in south and southeast Brazil. A
stochastic frontier econometric method in a dual approach is used to obtain the
economic efficiency estimates. The economic efficiency estimated for the firms
studied was very high, ranging between 93-100 per cent, approximately.
Iddamalgoda et. al. (1998) examined the production cost factors and
marketing margin involved in producing eggs in the surveyed countries. In this study
the egg production cost in defined as the total of the direct costs (feed and chick) and
indirect costs (labour, machinery and implement, building, power and medicine).
Marketing margin is considered as the difference between egg retail price and
producer price. The cost of production for eggs varies widely around the world and
the feed cost is the single most important factor among them followed by labour and
bird depreciation cost. The objectives of this study are to analyze the different cost
factors affecting the production of a kilogram of eggs, to compare the marketing
margin from producer to retailer. In order to fulfill the objectives, 15 selected
countries around the world were surveyed during 1996. Data was collected based on
different cost factors as well as producer and retailer prices for the respective
countries.
Srivastava, Ashutosh (1999) did the study on economic of poultry production
and marketing in Jabalpur district (M.P) with the main objection (1) to study the
socioeconomic status of the organized and unorganized poultry farms in Jabalpur
district of Madhya Pradesh state India, (2) to find out the cost of production of eggs
and broilers on organized and unorganized farms; and (3) to study the marketing
channels of eggs and broilers. A sample of 15 poultry units and 12 broiler farms was
selected from the organized sector and 25 poultry farms were randomly selected from
the unorganized sector. The study covers the period January 1997 to March 1998 for
broiler farms. Results reveal that commercial layer and broiler units, particularly the
larger farms were well managed and cost effective as compared to the small and
medium farms. Among the four main marketing channels two accounts for a 75%
share of egg marketing and one accounts for a 90 percent share of broiler marketing.
Poultry farming is considered to have good prospects in the district due to relatively
cheaper land and labour input originating from tribal areas. It is recommended that
efforts should be made to exploit this potential.
Farooq, Mian and Asghar (1999) reported that cost of production and net
profit per broiler were Rs 51.38 and Rs 7.92 respectively. Percent mortality has a
negative effect on net profit per broiler but did not effect cost of production. Market
age and flocks size were positively and negatively associated with net profit. Net
profit was lower when the flock size was less than 1500 birds for broilers maintained
under average hygienic conditions higher flock size, reduction in mortality and market
age, better utilization of the available shed capacity and use of concrete floors were
suggested as important factors for increasing net profit for broiler production.
Patel (1999) study revealed cost benefit analysis that broiler production can be
profitable enterprise in India. As feed is the major cost of input in broiler production
and cost can be reduced and profitability can be increased by having proper feeding
management. Cost of feed and cost of chicks accounted for maximum cost
approximately 80 per cent.
Othman, Salman and Shakib (2000) stated that poultry industry in Jordan has
witnessed an accelerating development since the early 1960’s, with the launching of
private investment. The poultry sector is considered as the most important agricultural
sector in the country and contributed about JD 180 million to the GDP in 1995. This
study was undertaken on the majority of the broiler breeder stock farms in Jordan and
aimed to investigate the technical standards and equipment for broiler breeder houses
and determine the size needed to achieve economic efficiency and maximum profit.
Analysis of variance was conducted to determine the technical factors affecting the
mortality and hatchability rates.
Prasad, Jagdish (2000) in his book and particularly in the chapter on
economics of poultry farming gave a detailed account how remunerative and
profitable broiler farming is. He discussed at length the total recurring cost of 2500
broilers per cycle with five crops a year and in that he showed maximum expenditure
on feed. The results of study showed broiler farming is economically viable.
Richard and Joseph (2000) observed that poultry and egg marketing channels
and processes continue to be shaped by the forces of production concentration,
integration and decentralization. The industry is in the advanced stage of
industrialization, with close coordination of production and marketing. Integration
extends from the input supply industries to wholesale distribution. Open market
negotiating and pricing are rapidly disappearing. Nevertheless, this industry exhibits a
relatively high degree of operational and pricing efficiency.
Riaz and Syed (2000) examined the economic viability of broiler farms in
Kamrup district of Assam. A typical farm had to incur about Rs 31.00 to produce one
kg of broiler and earn a net income of Rs 7.21 from the same in a cycle of eight
weeks. The income of farmers increased with an increase in size groups. Both break-
even production and break even price were lower than the respective average
production and average price received. Regression analysis on gross income showed
that coefficients of cost of feed, cost of chick and cost of electricity were positive and
significant.
Cobanoglu et al. (2002) analyzed the economic structure and economic results
of commercial broiler producing farms in Aydn province, Turkey. Data were collected
through a questionnaire, survey of 30 broiler farms, conducted between November
and December 1999. The biggest part of the farms assets consists of building capital
(41.46%) and machinery capital (19.75%). Average slaughter age was 42.50 days.
Average feed consumption was 3.60 kg and live weight was 1.9 kg per chick at the
end of the fattening period. Feed conversion rate was 1.93, while feed efficiency was
51.80. Total production expenses consisted of feed costs (67.95%) chick costs
(17.37%) and other costs (14.68%). Average income per live weight was 35,829.24
TL/kg.
Kohls and Uhl (2002) reported in the book about poultry and egg marketing in
United States. They reported that both poultry and egg marketing showed an
increasing trend. Broilers showed maximum increasing trend in poultry production
when compared to chickens and turkeys.
Biswas et al. (2003) gave the results of a survey report on broiler production
and marketing situation conducted in three coastal districts of west Bengal particularly
South 24 parganas, North 24 parganas and Midnapore, are presented. The survey was
designed at two levels for broiler farmers and for broiler meat retailers, Four farmers
were randomly selected from each village. The relevant parameters of broiler chicken
production and marketing are discussed. These include period of operation, stock
procurement, market sales, profit, monthly income, sale of meat, utilization of dead
stock, rearing systems and marketing age. The study results showed that the larger
farms are better managed by trained personnel and give higher returns. The findings
indicate the sustainability of broiler farming in the locality. Areas for further
improvement are identified and discussed.
Torkamani and Shirvanian (2003) investigated to study the production
function and technical efficiencies in broiler units, determine the optimum levels of
production factors as well as optimum and near optimum feed rations for broilers.
Data was collected from 192 broiler units in Fars province, Iran. Transcendental
production and stochastic frontier functions were used to investigate the production
relationships and technical efficiencies in the study units respectively. Optimum and
nearly optimum food rations were determined using linear programming and modeling
to generate alternative techniques. Analysis of the results showed the possibility of
increasing technical efficiencies and well as decreasing feed costs in broiler units.
Olukosi, Daniyan and Matanmi (2003) reported that over one hundred and
thirty two-4 weeks old unserved Anak-200 broiler strain chickens to study the effect
of feeder space allowance on agonistic behaviour and growth performance from week
4 to 8.The feeder space allowances (cm/bird) were 2.4, 3.0 and 3.6. The agonistic
behaviour that was observed included head pecks, steps, pushes, threats and chase
during feeding and non feeding periods. Increasingly the feeder space reduced
agonistic acts (acts/bird/hour) during the feeding period from 7.8 (at 2.4 cm feeder
space) to 4.5 (at 3.6 cm/bird). There was no effect of feeder space allowance on mean
agonistic acts during the non-feeding period. Feeder space allowance had no effect on
growth performance parameter.
Sokoowicz and Krawczyk (2004 a) studied the factors affecting the
profitability of broiler production in Poland in 2001-03 were analyzed using a selected
broiler farm in Podkarpackie province as case study. For all the cycles analyzed, basic
production results were determined and a European production India (EPI) and costs
of broiler production were calculated. The production profitability index was also
calculated. For all the cycles analyzed, the EPI index exceeds 220, which indicates
good productivity. Feed costs accounted for the greatest proportion (61.8-69.1%) of
the production costs, while the proportion of non-feed costs of farm operations during
the analyzed period tended to decline. The economic analysis of farm performance
showed that during the analyzed period the selling price of live broilers showed
frequent fluctuation regardless of the prices of inputs. No clear relationship was
observed between production results and production profitability.
Selvam (2004) conducted a study in 2000-01 in 5 villages of Namakkal district
(Tamil Nadu, India) to find out the economic potential of free range desi poultry
rearing by rural women. The farms were post stratified into small (41 farms), medium
(40 farms), and large (14 farms). The flock sizes were 5,12 and 26 and egg production
for each flock size was 44, 49 and 52 respectively. The average annual farm income
from sale of eggs and birds was Rs 2667.90, Rs 6971.04 and Rs 15273.44 for small,
medium and large farms, respectively. For brooding, birds were used. The sale price
of eggs and birds on free range rearing was much higher than the sale price of
commercial eggs and broilers. No periodic vaccination and no proper shelter were
provided to the birds.
Sarbiland et al. (2004) undertook a study to investigate the economic status of
83 broiler farms in chakwal, Punjab, Pakistan during the year 1998-99. The average
fixed cost per broiler (Rs 51.92) represented Rs 48.51 and Rs 3.41, respectively, for
building construction and equipment cost. Average variable cost, gross return and net
profit per broiler was Rs 63.42 + or -1.97, Rs 77.16 + or -1.61 and Rs 13.74+ or - 2.29
respectively. Average turnover rate of net profit on the invested, capital per flock and
on an annual basis was 24.17 or -2.36 and 127.27 + or - 13.90%, respectively. Feed
cost was the major component contributing 60.27% to the total cost. All the farmers
were following almost similar standard vaccination practices; thus its effect on cost of
production and net profit was not established. Rate of mortality, flock size, number of
flocks per year, duration between two batches, feed efficiency and broilers age at the
time of marketing did not affect cost of production and net profit per broiler. Hygienic
conditions at the farm, weight at marketing, floor space utilization and house
construction, significantly (P<0.01) affected net profit per broiler. Aside from better
management, stable market, better utilization of available facilities, appropriate house
construction, accelerated gain in weight at the lowest market age and maintenance of
standard hygiene would further improve profitability of broiler farming in chakwal
district, Punjab province, Pakistan.
Krawczyk and Sokoowicz (2004) studied the performance and profitability of
hatching egg production in two flocks of broiler hens used in different periods.
Economic analysis showed that hatching egg production was profitable in both cycles.
Sokoowicz and Krawczyk (2004 b) observed rearing performance and
profitability of broiler chicken production were analyzed under conditions of variable
prices of live birds, chicks and feeds from 2001-03. In all the cycles analyzed basic
productive results were determined and the European Production Index (EPI) and
costs of broiler chicken production were calculated. To determine the economic
results of the farm, income was estimated in each cycle and the index of profitability
and the live bird to feed and chick price ratio were calculated. The economic analysis
of farm results showed that in the analyzed period the price obtained for live poultry
was subjected to frequent changes regardless of the prices of cost carriers. No marked
relationship was observed between production results and profitability of production.
Hakeem (2006) in his article described the importance of broilers in the human
diet he described commercialization as essential for the appropriate growth of broiler
keeping industry. The concept of sideline, subsidiary or semi-commercial broiler
keeping is becoming a thing of the past. Though broiler rearing fits in nicely with the
integrated system of agriculture for most peasants with small or marginal holdings,
commercial broiler farming is catching on. Larger farms are better managed by trained
people and give higher yields as compared to smaller colonies which are
inappropriately managed.
Khan (2007) in his article described poultry as domesticated birds that are bred
specifically to provide meat and eggs for human consumption. They include fowl,
duck, geese and turkeys. Fowl are the main source of meat and eggs for human
consumption. He also described the safety of poultry meat especially broilers and
layers.
The findings of the earlier studies helps in conceptualizing the problem and the
methodology of investigation and analytical techniques were followed in the present
study. The reviewed studies reflect that not much work has been attempted or
undertaken to analyze the economics of broilers and marketing prospects. Most of the
work on the economics of broilers has been done abroad and not much work has been
done in India regarding this sector. However through related research reviews,
methodology adoption and analytical tools to analyze the economics of production
and marketing of broilers were very useful in the present study.
Main issues of the different studies reviewed in the preceding paragraphs
shows how much remunerative is the broiler industry, if managed properly as per the
guidelines outlined by poultry experts and if trained personal are available. This study
will help policy makers, govt. agencies, marketing agencies and alike to take measures
regarding the production, trade and marketing practices of broilers. My study will also
help further research pertaining to the industry. Also this work shall be of academic
utility and may show some guidelines to the personal involved in this trade.
Chapter-III
Materials
And
Methods
MATERIALS AND METHODS
Research methodology
A researcher is guided by the maxim that while discoveries cannot be planned,
work must be planned, if it is to lead to discoveries. All researches begin with the
preparation of a research design. To design means to plan.
A research design is the overall plan or programme of research. It is the
blueprint for the collection, measurement, analysis and interpretation of data. It
includes an outline of what the investigator will do from writing the hypothesis and
their operational implications to the final analysis of data. There are four parts of
research design 1) Sampling design, which describes the various sampling methods to
be used for selecting subjects for study, 2) Observational design, which describes the
way in which the observations were made, 3) Statistical design, which describes the
statistical techniques used for analyzing and interpreting data and 4) Operational
design, which describes how the entire operation of research was carried out. Based
on there factors, a single value of each parameter under study such as yield, returns,
profitability etc. is generated.
The present chapter deals with the operationalization of concepts and
measurement techniques in view of the objectives of the study. The purpose of this
chapter is to present briefly the sampling technique followed, research strategies
adopted & statistical tools used for drawing valid inferences.
Area of study
The area of the study has been various villages of Shankargarh and Chaka
Block of Allahabad district, as broiler rearing and production is practiced on
commercial scale in the district in general and these blocks in particular. Poultry
keeping is one of the leading farms occupation in these selected blocks as well as
villages. These two blocks (Shankargarh and Chaka) contribute nearly 70 per cent of
broiler production in the Allahabad district.
Sampling Design
For the present study entitled “Economics of production and marketing of Broilers in
Allahabad District of Uttar Pradesh,” four stages stratified sampling procedure was
adopted to select the sample.
First stage : Selection of the district – Purposive
Second stage : Selection of the blocks – Purposive
Third stage : Selection of the villages – Random
Fourth stage : Selection of broiler farmers – Random
Stage first:
Selection of the district
Broiler production is practiced as one of the subsidiary farm operation in rural
areas but it is practiced on a commercial scale in Allahabad district. Allahabad district
was purposively selected as the researcher was well acquainted with the locale.
Financial constraint and available resources in the command area were also the
reasons behind purposive selection of district.
Stage second :
Selection of the blocks
Out of the total 20 blocks of district Allahabad, Shankargarh and Chaka blocks
are purposively selected as these blocks accounted for the maximum production of
broilers as well as these two blocks were easily accessible to the researcher. The
population of these two blocks was also maximum in Allahabad district as this being
the reason behind purposive selection of blocks.
Stage third:
Selection of the villages
A complete list of all the poultry rearing villages of both blocks was obtained
from block development offices of concerned blocks. Then villages were arranged in
descending order on the basis of number of poultry farms. Then 10 per cent of the
villages were selected randomly from each block. As a result out of 38 poultry rearing
villages of Shankargarh block four villages were selected and out of 44 poultry rearing
villages of Chaka block four villages were again selected. These, eight villages of both
blocks were selected randomly by Simple Random Sampling Technique.
Table 3.1 Selection of blocks and sample villages.
S. No. Name of selected villages Random No.
SHANKARGARH BLOCK
1 Janya 12
2 Pandva 45
3 Madanpur 23
4 Sunderpur 15
CHAKA BLOCK
1 Piparsa 09
2 Dandopur 14
3 Imelia 07
4 Mahewa 32
Stage fourth:
Selection of the broiler farmers
A list of all the broiler farm owners of the selected villages was obtained from
village revenue office and village heads. The broiler farm owners were categorized
into three groups on the basis of their size of broiler farms. First group (small size
broiler farm owners) comprised of those having below 500 birds in their herd, second
group (medium size broiler farm owners) comprised of those having 500 – 1000 birds
in their herd, whereas third size group (Large size broiler farm owners) comprised of
those having above 1000 birds in their herd. From each village and size group a
sample of 10 per cent of respondents were selected with a minimum of 10 respondents
from each village by stratified random sampling technique. The distribution of sample
broiler farm owners under different size groups has been presented in table 3.2
Table 3.2: Selection of sample respondents.
S.No.
Villages
Total No. of broiler farms Tota
l
No. of selected broiler farms Tota
lSmall
Medium
Large
Small
Medium
large
1 Janya 48 41 29 118 5 4 3 12
2 Pandva 57 61 51 169 6 6 5 17
3Madanpur
59 28 39 126 6 3 4 13
4Sunderpur
70 38 76 184 7 4 8 19
5 Piparsa 47 32 22 101 5 3 2 10
6 Dandopur 60 48 29 137 6 5 3 14
7 Imelia 49 52 49 150 5 5 5 15
8 Mahewa 46 94 47 187 5 10 5 20
Total 436 394 342 1172 45 40 35 120
Selection of the market and market functionaries
Allahabad district of Uttar Pradesh is having population about five million.
Allahabad is traditional broiler marketing centre of Uttar Pradesh. It is the hub of
many wholesalers, poultry farm holders and exporters of broilers. The broiler
production from other areas of Allahabad are also brought to Allahabad market. The
main market for broilers selected was Kuldabad market in Allahabad district. The
main market functionaries involved in the marketing of broilers are itinerant traders,
hoteliers, wholesalers and retailers and consumers, A sample of 25 from each of
market functionaries involved in the marketing of broilers was drawn from the
Allahabad market.
Method of study and collection of Data
Primary:
Survey method was used for the collection of the primary data. The selected
respondents were contacted on regular visits and relevant data were collected with the
help of pre-tested and pre-structured schedules, particularly designed for the selected
problem. The primary data was obtained from the broiler farm owners of the study
area.
Secondary:
The secondary data were collected from the records of the published reports,
journals, bulletins, folders, books, records of Animal Husbandry offices, Vikas
Bhawan, block development office record, district information centre village heads,
district animal husbandry officers, block development officers, revenue office,
agriculture office, marketing officers and other relevant sources.
Period of enquiry
The period of enquiry is related to the agricultural year 2005-06.
Prices of inputs
The price of inputs and outputs were collected along with the physical quantity
from farm owners, wholesalers, retailers, marketing agencies etc. The information
about prices was also obtained from district animal husbandry office, co-operative
department, poultry officer and other such relevant experts. The wages for human
labour were given on prevailing wage rate in the study area. Electricity charges were
charged at prevailing rate. Output prices were those which were prevailing after the
sale of broilers.
Estimation of costs and returns
a. The data collected were tabulated and analyzed with the help of suitable
statistical tools and measures.
b. For estimation of costs and returns, the costs of all the inputs such as of poultry
equipment, chicks, feed, medicine, labour charges, watch and ward, as reported
by the broiler farm owners.
c. Family labour and home producing inputs were evaluated at the price
prevailing in the villages.
d. All material input costs and the labour input cost were used to calculate the
total operational costs.
e. Interest on working capital was evaluated at the rate of 4 per cent per annum on
the total operational cost.
f. Interest on fixed capital at the rate of 12 per cent and depreciation on fixed
assets were worked out on the basis of the assets reported to be in use by
broiler farm owner’s.
g. The rental value of the land was estimated on the basis of opportunity cost of
land.
h. The cost of production of broilers included expenses of human labour (hired as
well as imputed value of family labour) + interest on working capital +
expenses incurred on material inputs (cash and kind) + depreciation and
interest on fixed investment + imputed rental value of land + marketing charges
incurred by the producer.
i. The gross return was computed as gross value of out put of farm at gate prices
and the net return as gross returns minus total cost of production.
ANALYTICAL TECHNIQUES
Techniques employed
Several techniques are available for evaluating the economic viability of an investment
project. To evaluate the economics of any enterprise, the following important indicators
are used
(a) Pay – Back Period (PBP)
(b) Net present value (NPV)
(c) Internal rate of return (IRR)
(d) Benefit-Cost Ratio (BCR)
The formal definitions of these investment criteria are given below:-
(a) Pay-Back Period (PBP)
The pay back period is the number of years an investment project takes to
recover its costs from its returns. Symbolically,
t* t*
∑ Ct = ∑ Rt
t =0 t =0
Where, Rt = Return in period ‘t’
Ct = cost in period ‘t’
t*= Pay back period
(b) Net present value (NPV)
The net present value of an investment is the discounted value of all cash
inflows, net of all cash out flows of the project during its lifetime. It can be computed
as
NPV =
Where the new notations have the following meanings.
i = Discount rate T = Project life
(c) Internal rate of return (IRR)
The internal rate of return (r) is that discount rate at which the NPV is zero.
The equation for its calculation is:
IRR = =0
(d) Benefit – Cost Ratio (BCR)
The benefit – cost ratio of an investment is the ratio of the discounted value of
all cash inflows to the discounted value of all cash outflows during the life of the
project. It can be computed as:
BCR =
Where
T∑ t =0
Rt – Ct
(1+ i)T
Rt – Ct
(1+ i)T
T∑ t =0
Rt / (1+i)t
Ct / (1+i)tT∑ t =0
T∑ t =0
Rt = Return in period ‘t’
Ct = Cost in period ‘t’
i = Discount rate
T = Project time
The criteria adopted to select the project investment as worth while.
(a) Pay Back period (PBP) should not be greater than the investor’s desired PBP.
(b) Net present value (NPV) should be positive and greater than zero.
(c) Internal rate of return (IRR) of the project should be positive and greater than
the cost borrowing.
(d) Benefit – Cost ratio (BCR) of the investment should be positive and greater
than one.
If all these criteria are fulfilled, then the investment will be justified as
profitable and economically feasible (Gittinger, 1976).
For the present study two criteria’s are taken to find the economic viability of
broiler enterprise i.e Benefit –Cost ratio and Net Present Value. These two indicators
were selected as
ANALYSIS OF COST CONCEPT
Determination of the profit level is very much affected by the element of cost
taken into consideration. Cost concepts are widely used because of their relevance in
the decision making process. This means that these costs serve as a basis to expand the
size of the farm, to buy the requisite capital assets and inputs. The concepts of cost
have been classified into four categories depending on the purpose of study.
Cost A1
This gives the total cash expenses incurred by the owner or operator. This includes
the cost of the following items:
a) Cost of chicks.
b) Cost of feed.
c) Cost of medicine & vaccination charges
d) Cost of hired labour.
e) Cost of electrical items, saw dust & others.
f) Cost of electricity and water charges.
g) Depreciation on fixed capital.
h) Interest on working capital.
i) Miscellaneous charges
Cost A2 = Cost A1+ Rent paid for leased in land
Cost B = Cost A2+ Rental value of owned land + interest on value of owned fixed
capital assets (excluding land)
Cost C = Cost B + Imputed value of family labour.
Measures of Farm profit
There are various measures which can be used to evaluate farm profit. The
measures listed below were used for measuring farm profit.
Net income
It is excess of gross income over cost ‘C’ obtained by deducting all the
expenses from gross income.
Farm Business Income
It is computed as gross income minus cost A2
FBI = Gross income – Cost A2
Or FBI = Net income + interest on fixed capital + rental value of owned land +
imputed value of family labour
Family Labour income
It is the return to the farm operator and his family and it is computed by
deducting cost ‘B’ from the Gross income.
F.L.I = Gross Income – Cost B
Farm Investment Income
It is obtained by adding rental value of owned land and interest of fixed capital to Net
income.
F.I.I.= Net income + Rental value of owned land + Interest on fixed capital
ESTIMATION OF MARKETING COSTS AND MARGINS
The term ‘marketing margin’ refers to the difference in the prices paid for a
commodity at different stages of the marketing system. The marketing margin is the
difference in the price received by the primary producer and the price paid by the
ultimate consumer. This difference is often called as price spread. Marketing margin
includes all costs of assembling, processing, storage, transportation and handling,
wholesaling and retailing in the whole process of marketing i.e., moving the produce
from the farmer to the ultimate consumer.
The study of marketing margins is very essential for formation of an
appropriate price policy and its successful implementation. It assumes particular
importance in a predominantly agricultural country like India, where agricultural price
policy aims at safeguarding the interests of both farm owner as well as the consumer.
To safeguard the interests of the producer and the consumer, services of the
intermediaries should be made available at reasonable costs.
There are several methods of calculating the marketing costs and margins of
the intermediaries. In the present study, concurrent margin method has been used.
Concurrent margin refers to the difference between the prices prevailing at successive
stages of marketing at a given point of time, for example, the difference between the
farmer’s selling price and retail price on a specific date is the total concurrent margin.
Concurrent margins do not take into account the time that elapses between the
purchase and sale of the produce.
The margins in the marketing of broilers included:
i) The cost involved in moving the broiler from the point of production to the point of
consumption, i.e. the cost of performing the various marketing functions and of
operating various agencies; and
ii) Profits of the various market functionaries involved in moving the broilers from the
initial point of production till it reaches the ultimate consumer. The absolute value of
the marketing margin varies from channel to channel, market to market and time to
time.
Price Spread, Marketing Costs and Margin in broilers
In the present investigation, price spread in the marketing of broiler is
composed of costs of marketing incurred in rendering marketing services such as
assembling. packing and packaging, dressing, forwarding, transporting/ parceling,
wholesaling, retailing etc., and the margins of intermediaries. These margins and costs
are influenced by the performance and efficiency of different marketing functions,
which in turn, influence the returns to the farm owners on the one hand and price to
the consumer on the other hand.
This part of the study was undertaken to examine the marketing channels and
margins retained by different agencies involved in the process of broiler marketing.
The price spread has been analyzed in two terms
1. Rupees per 1 kilogram (1000 grams)
2. As percentage of producer’s share in consumer’s rupee
Measures of price spread
Producer’s price
This is the net price received by the farm owner at the time of first sale. If PA is
the wholesale price in the primary assembling market and CF is the marketing cost
incurred by the farmer, the producer’s price (PF) was worked out as follows.
PF = PA - CF
Producer’s share in the consumer’s rupeeIt is the price received by the farm owner expressed as percentage of the retail
price (i.e., the price paid by the consumer. If PR is the retail price and PP is the
producer’s price, the producer’s share in the consumer’s rupee (PS) may be expressed
as follows.
Ps = (PP/PR) /100
Marketing Margin of a middleman
This is the difference between the total payments (Cost + purchase price) and
receipts (sale price) of the middleman (ith agency). Two alternative measures have
been used.
(a) Absolute margin of the middleman (Ami)
Ami = PRi – (PPi + Cmi)
(b) Percentage margin of the ith middleman (Pmi)
Pmi = x 100
Where,
PRi = Total value of receipts per unit (Sale price)
PRi - (PPi + Cmi )
PRi
PPi = Purchase value of goods per unit (purchase Price)
Cmi = Cost incurred on marketing per unit
Total Cost of Marketing
The total cost, incurred on marketing either in cash or in kind by the producer –
seller and by the various intermediaries involved in the sale and purchase of the
commodity till the commodity reaches the ultimate consumer, was computed as under.
C = CF + Cm1 + Cm2+ Cm3+. . . . . . . . .+ Cmn
Where
C = Total cost of marketing of the commodity.
CR = Cost paid by the producer – farm owner and
Cmi= Cost incurred by the ith middleman in the process of buying and selling the
product.
MARKETING EFFICIENCY.
Marketing efficiency is essentially the degree of market performance,
According to Kohl’s and Uhl, “marketing efficiency is the ratio of market output
(satisfaction) to marketing input (cost of resources). An increase in this ratio
represents improved efficiency and a decrease denotes reduced efficiency. A reduction
in the cost at the same level of satisfaction or an increase in the satisfaction at a given
cost results in the improvement in efficiency.”(Acharya 1999)
According to Jasdanwalla, “The term marketing efficiency may be broadly
defined as the effectiveness or competence with which a market structure performs its
designated functions.”(Acharya 1999)
Shepherd’s Index of marketing Efficiency
Shepherd’s Index of Marketing Efficiency (ME) was calculated by:
ME =
An ideal measure of marketing efficiency particularly for comparing the
efficiency of alternate markets/ channels, should be such which takes into account all
of the following.
(a) Total marketing costs (MC)
(b) Net marketing margins (MM)
(c) Prices received by the farmer (FP)
(d) Prices paid by the consumer (RP)
In the present study, Shepherd’s method was employed for determining the efficiency of
different marketing channels involved in the marketing of broilers.
Retailer’s sale price or consumer’s purchase price
Total costs & margins
Chapter-IV
Description
Of
Tract
DESCRIPTION OF THE TRACT
The aim of this chapter is to present maximum information about the actual
surroundings of the locale in which the study was undertaken.
The state of Uttar Pradesh is one of the great historical and religious centers of
India. Its name means "Northern Provinces." Although Uttar Pradesh is only India's
fourth largest state in area and largest state in population. It is truly a miniature of
India in terms of diversity of people, religions, languages as well as geographical
features and agro-climatic conditions.
History of Uttar Pradesh:
Many Hindus believe that Uttar Pradesh is the birth place of Rama and
Krishna, the heroes of India's two great epic poems, the Ramayana and the
Mahabharata. The region is associated with all the religions of India, and it contains
important places of worship for Hindus, Muslims, Jains and Buddhists. Buddha
preached his first sermon at Sarnath near Varanasi. From the 200’s BC, Uttar Pradesh
was part of the Mauryan Empire. Later, Various Hindu dynasties controlled the
region. In the late A.D. 1100’s, invading Turks established a Muslim empire called the
Delhi sultanate. It extended its influence over Uttar Pradesh. In mid 1500’s, Uttar
Pradesh became the political and cultural heart of Mughal empire. Shah Jahan build
Taj Mahal at Agra. Revolt of 1857 started at Meerut city and spread to Lucknow,
Allahabad, Kanpur, Agra and Jhansi. During 1900's Uttar Pradesh was in the vanguard
of the national movement for Independence.
Location:
Garlanded by the Ganga and Yamuna, the two pious rivers of Indian
mythology, Uttar Pradesh is surrounded by Bihar in the East, Madhya Pradesh in the
south, Rajasthan, Delhi, and Haryana in the west and Uttaranchal in the North and
Nepal touch the northern borders of Uttar Pradesh, it assumes strategic importance for
Indian defence. Its area of 2,36, 286 sq. kms lies between latitude 24 degrees to 31
degrees and longitude 77 degrees to 84 degrees East. In sheer magnitude, it is half of
the area of France, three times of Portugal, four times of Ireland, seven times of
Switzerland, ten times of Belgium and little bigger than England.
Soil:
The soils of Uttar Pradesh are different in different regions. They differ from
sandy loam to black soils.
Minerals:
Minerals found in Uttar Pradesh include limestone which is found in Guruma-
Kanach-Bapuhari in Mirzapur district and Kajrahat in Sonebhadra district; dolomite
found in Mirzapur, Sonebhadra and Banda districts; glass sand found in Allahabad
and Banda districts; marble found in Mirzapur and Sonebhadra ; Bauxite found in
Banda district ; non-plastic found in Bansi and Mirzapur and Uranium found in
Lalitpur district. Besides Barytes, Edalusite, sand stone, pebbles, reh, salt punter,
marang, sand and other minor minerals are found in the state.
Vegetation (flora and Fauna)
The flora of a region includes all the varieties of plants which grow in Uttar
Pradesh. The plains of Uttar Pradesh have been very rich in natural vegetation. The
diversity of fauna living in water and land in the air are found in the state e.g. fish,
amphibia, reptiles, aves, mammals etc,. Other common species found in Uttar Pradesh
are Tiger, Panther, Snow leopard, Sāmbhar, Cheetal, Kastura, Chinkara, Black deer,
Nilgai, Back-brown bear, Mountain goat, Hyena, Hill dog, Elephant etc. Among the
birds Fowl, Pheasant, Partridge, Florican, Duck, Goose, Broilers and wader are
common.
MAP OF CHAKA BLOCK
MAP OF SHANKARGARH BLOCK
Climate: The whole state has a tropical monsoon climate. Winter (December to
February) temperatures range from 70C minimum to 270C maximum. Summer (April
to June) temperatures range from 220C minimum to 420C maximum, with occasional
extremes of 450C. A hot, dry wind often blows from the west. The monsoon lasts from
mid June to mid September, during which time the maximum temperature drops a few
degrees, humidity increases and 80 per cent of the annual rain falls. The eastern parts
of the state receive between 100 and 200 centimeters of rain per year. Rain fall in the
west is less, with some places receiving under 50 centimeters per year.
Economy of state:
Agriculture: Farming is the main occupation of the three fourth of the
working population. Many peasants have farms that are too small for efficient
agriculture. The main problem is the pressure of population on land sources. The soils
are fertile and there is good rainfall over nearly all the region. Irrigation facilities
bring water to about one-third of the cropped area. Wheat, rice, maize, millet and
pulses, such as beans, peas and lentils are the major food crops. Uttar Pradesh is one
of the major producers of sugar cane in India. Cotton, oilseeds, jute, potatoes and
tobacco are other important cash crops. As part of national and state projects for
sericulture (the production of silk fibre), large-scale planting of mulberry trees is
under way across the state. Mulberry trees provide food for the caterpillars of the
silkworm moth.
Manufacturing: Cotton mills were first established in Kanpur in 1869,making
it one of the older factory cities of India. It has become one of the greatest industrial
cities, with woolen and leather industries, cotton, flour and vegetable oil-mills, sugar
refineries and chemical works. The state government has established cement factories
near Mirzapur, precision instrument factories around Lucknow, a chemical plant at
Bareilly and a diesel locomotive factory at Varanasi. It has also introduced fertilizer
factories at Gorakhpur and Allahabad, telephone industries at Genda Naini and Rae
Bareli, electronics industries at Ghaziabad, and scooter factories at Lucknow, as well
as an oil refinery at Mathura.
Mining : Uttar Pradesh does not have rich mineral resources. Mines and
quarries produce limestone, silica, magnesite, and phosphatic shale. Soapstone,
copper, lead, zinc, marble, and bauxite are also found in the state. There are coalfields
in Mirzapur district. Electricity produced by coal burning power stations is the most
important source of energy.
Transportation :There is an extensive road and rail network throughout the
state. Because of the size of the population, this network is constantly under pressure.
The main railway junctions include Agra, Allahabad, Gonda, Gorakhpur, Jhansi,
Kanpur, Lucknow, Mathura, Moradabad, Gaziabad and Varanasi. The major defect of
the rail system is that there are two different gauges (widths of track). Air routes link
several large towns with Delhi and with one another.
Tourism : Uttar Pradesh contains many famous tourist sites. They include ancient
monuments, such as the Taj Mahal at Agra and the Mughal city of Fatehpur Sikri. Millions
of pilgrims visit Allahabad and Varanasi to bathe in the waters of the Ganges River, which
Hindus consider to be sacred.
Table 4.1 : U.P. At a glance
S. No. Particulars Status
1 Population 166197921
a) Males 87565369
b) Females 78632552
2 Sex ratio (females per 1000 males) 898
3 Density of population (persons per sq. km.) 689
4 Urban population ( Percentage) 20.78
5 Literacy rate (Percentage), 2001 census 57.36
6 Male literacy (Percentage) 68.8
7 Male literates in numbers 48901413
8 Female literacy (Percentage) 42.2
9 Female literates in numbers 26817871
10 Birth rate (per 1000) 31.6
11 Death rate (per 1000) 9.7
12 NSDP at current prices (2002-03) Rs. crores 170424
13 Per capita NSDP (2002-03) at current prices, Rs. 9895
14 Area (Sq.Km.) 236286
15 Coastline (Km) 0
16 Districts 70
17 Parliament constituencies 80
18 Legislature Constituencies 242
19 Surfaced roads (per 100 sq/km) 47.1
20 Road length (per 1000 km) 818
21 Railway track length (per 100 sq km) 206
22 Capital Lucknow
Source : Directorate of Economics and statistics of respective state governments (As
on March 26, 2004), Ministry of Health and Family welfare, Govt. of India.
Table 4.2 : Percent share of Economic Activity
S.No. Sector Percent Share
1 Agriculture 43
2 Services 37
3 Manufacturing 20
Source : www. Google.com; www.upgov.nic.in
Table 4.3 : Investor’s Profile
S. No. Sector Percent Share
1 Government 49.3
2 Indian 40.8
3 Foreign 9.9
Source : www. Google.com; www.upgov.nic.in
The Uttar Pradesh state comprises of 70 (seventy) districts. Allahabad district,
which is the area of study for the present research problem is among the
largest district of Uttar Pradesh and situated at the confluence of three rivers-
Ganga, Yamuna and the invisible Saraswati. Allahabad was the heart of Indian
freedom movement against the British rule with Anand Bhawan being the
epicenter. Allahabad is basically an Administrative and Educational city. High
court of Uttar Pradesh, Auditor General of Uttar Pradesh, Principal controller of
defence accounts (Pension) PCDA, U.P. Education board etc are situated
here. ITI Naini, IFFCO Phulpur & Triveni glass are some of the major industries
here at Allahabad. The details about Allahabad district are given in table 4.4.
Broiler industry in Allahabad:
Allahabad district having population about five million is having good scope for
broiler industry. There are many hatcheries located at Mumfordganj, Naini and
adjoining places. These hatcheries were supplying one day old chicks to the
farm owners and these chicks were raised upto slaughter age. There were also
many feed centers located in Allahabad which were supplying feed to the
broiler farm owners. There was no dearth of inputs for broiler industry in
Allahabad.
The output i.e live as well as dressed broilers were disposed off in local as
well as in other states market. Local market where broilers were disposed off
was Kuldabad market and produce was also sent to Madhya Pardesh, Bihar,
Delhi etc.
Table 4.4 : Allahabad at a glance
S. No. Particulars Status
1 Area 5482 sq. km
2 Area under cultivation 555413 ha.
3 Population 4936105
4 Male 2626448
5 Female 2309657
6 Total Blocks 20
7 Total Tehsils 07
8 Total villages 2802
9 Inhabited villages 2540
10 Uninhabited villages 262
11 Electrified villages 2202
12 Primary Health centers (PHC) 68
13 Community Health centers (CHC) 13
14 Literacy rate in percentage 47.75
Source : Distt. Economic and Statistics Office, Vikas Bhawan, Allahabad.
Allahabad district comprises of seven tehsils i.e. Karchhana, Meja, Karoan,
Bara, Handia, Saroan and Phulphur. Out of the total 2802 villages,2540 villages are
inhabited villages. According to revenue records 262 villages are uninhabited.
The population of the district is around five million and it is located at an
altitude of 98 meter above the sea level. The males are more than females as males are
2626448 and females are 2309657.
Agriculture is the main occupation of the people. The main crops grown are
wheat, paddy, arhar, soyabean, pea etc. The broiler production is also catching on in
Allahabad district. The two blocks selected for the study are practicing broiler
production on a commercial scale. Allahabad is also famous for the cultivation of
“guava”.
Table 4.5: Month-wise mean maximum and minimum temperatures at
Allahabad
S. No Month
Mean maximum(0c) Mean minimum(0c)
Year Year
2005 2006 2005 2006
1 January 23.18 26.51 8.58 7.06
2 February 29.58 32.46 12.90 13.07
3 March 35.15 33.45 18.20 15.78
4 April 39.56 39.92 20.28 20.94
5 May 43.75 40.00 24.52 25.80
6 June 42.70 38.57 28.60 27.70
7 July 33.28 33.60 25.14 25.36
8 August 33.94 33.50 25.12 25.47
9 September 33.12 34.47 24.52 25.42
10 October 33.06 34.50 19.67 20.93
11 November 33.05 29.82 11.30 13.89
12 December 25.72 26.95 6.52 9.20
Source: Agro meteorology, College of Forestry, AAI-DU. Allahabad
Table 4.6 : Month wise mean humidity (%age) and total rainfall (mm) of Allahabad
district for year 2005 and 2006)
S.
NoMonth
Mean Humidity (%) Total rainfall
(mm)Year
2005 2006 2005 2006
7 am 2 pm 7 am 2 pm
1 January 93.8 50.32 90.63 33.91 - -
2 February 88.25 39.6 76.46 28.25 4.1 0.1
3 March 79.0 32.75 75.55 29.0 14.4 19.7
4 April 56.8 18.34 62.78 23.96 15.2 29.7
5 May 37.97 14.6 67.65 36.92 - 29.0
6 June 52.62 28.83 71.57 44.53 89.5 104.5
7 July 88.02 62.36 87.16 73.14 281.1 378.6
8 August 87.23 64.95 85.42 65.35 175.5 163.0
9 September 87.27 64.2 87.28 63.5 121.9 58.5
10 October 86.0 46.74 89.16 48.12 33.1 11.3
11 November 89.5 29.18 91.3 36.07 - -
12 December 8
8.38
29.98 81.3 30.48 0.1 -
Source: Agro meteorology, College of Forestry, AAI-DU. Allahabad
The two blocks selected for the study were Shankargarh and Chaka. The names of the villages are given in Table 4-7.
Table 4.7 : Name of selected villages along with Blocks
Block Name of village Block Name of village
Shankargarh Janya Chaka Piparsa
Shankargarh Pandva Chaka Dandopur
Shankargarh Madanpur Chaka Imelia
Shankargarh Sunderpur Chaka Mahewa
The details of block Shankargarh is given in following table.
Table 4.8 Details about block Shankargarh
S. No. Particulars Status
1 Total Area 469.108 sq. km
2 Land under cultivation 46908 ha.
A Unirrigated land 31627 ha.
B Irrigated land 15281 ha.
3 Forest land 4818 ha.
4 Total population 135486
A Male 71739
B Female 63747
5 Total villages 187
A Inhabited 163
B Uninhabited 24
6 Educational Institutions
A Upto Primary School level 154
B Upto High school level 8
7 Health centres 3
8 Nyay Panchayat 10
9 Gram Panchayat 60
10 Literates 38423
12 Literacy Percentage 54.17
13 Livestock Population 12718
14 Anganwadi centres 123
15 Mahila Mandal 04
16 Assembly constituency 01
17 Banks 05
A Nationalized Banks 02
B Grameen Banks 03
18 Principal crops Wheat, Rice, etc.
Source : Block office, Shankargarh.
The details about block Chaka is given in table 4.9
Table 4.9 : Details about block ChakaS. No. Particulars Status
1 Total Area 573.74 Sq.km
2 Land under cultivation 7666.5 ha.
A Irrigated land 4599.9 ha.
B Unirrigated land 3066.6 ha.
3 Forest land 2095 ha.
4 Total population 173084
A Male 92860
B Female 80224
5 Total villages 127
A Inhabited 100
B Uninhabited 27
6 Educational Institutions 163
A Upto Primary School level 92
B Upto High School level 47
7 Health centres 07
8 Nyay Panchayat 8
9 Gram panchayat 49
10 Literates (in numbers) 72002.94
12 Literacy percentage 41.6 %
13 Livestock population 48503
14 Anganwadi centres 104
15 Mahila Mandal 104
16 Assembly constituency 02
17 Banks 12
A Nationalized Banks 10
B Grameen Banks 02
18 Principal crops Wheat,paddy,etc.
Source : Block office, Chaka.
Chapter-V
Results
& Discussion
RESULTS & DISCUSSIONS
The present study pertains to “Economics of Production and Marketing of broilers in
Allahabad district of Uttar Pradesh”. The sources of data collection were primary as well as
secondary and then there data were tabulated, analyzed and the results are interpreted and
presented in this chapter keeping in view the objectives of the study.
Average size of broiler farm
This aspect was studied to determine the number of birds raised in different season wise and
lot wise each size group and in each farm in a year.
Table 5.1: Average size of the broiler farms in all size groups in different seasons in a
year with total.
S. No. ParticularsSize Group Sample
AverageSmall Medium Large
No. of Households Selected 45 40 35 40
A. SUMMER SEASON
1.Total no. of broilers raised in summer season (two production cycles)
34380 70080 114660 69695
2. Average no. of broilers raised in one cycle 382 876 1638 913.00
3.Total no. of broilers raised in,I Production cycleII Production cycle
380384
870882
16281648
907.33918.66
B. WINTER SEASON
1Total no. of broilers raised in winter season (two production cycles)
35640 73200 138530 78169.58
2 Average no. of broilers raised in one cycle 396 915 1979 1030.70
3Total no. of broilers raised in,I Production cycleII Production cycle
390402
912918
1968 1990
1024.25 1037.16
C. RAINY SEASON
1Total no. of broilers raised in rainy season (two production cycles)
31050 66400 107800 65218.75
2 Average no. of broilers raised in one cycle 345 830 1540 855.20
3Average no. of broilers raised in,I Production cycleII Production cycle
342348
825835
1542 1538
853.00 857.41
D ALL SEASONS (TOTAL)
1Total no. of broilers raised in all seasons (two production cycles)
101070 209680 360990 213083.3
2 Average no. of broilers raised in one cycle 1123 2621 5157 2798.91
3Average no. of broilers raised in,I Production cycleII Production cycle
1112 1134
2607 26355138 5176
2784.582813.25
Total number of broiler farms selected for study was 120 comprising 45 small, 40 medium
and 35 broiler farms of large size.
Structure of farm families
The information about farm families is an important aspect of any study concerning
farmer. The structure of the family plays a vital role in the farm economy since it is related to
the pressure of population on land. The income earning capacity of the family and the
decision making in the management of farm are closely related to the structure of the farm
families. This particular aspect was studied and is depicted in the table 5.2.
Table 5.2: Structure of Farm families
S. No. Size group Average size of familySex ratio
Male Female
1. Small 6.94 (100) 3.93 (56.63) 3.01 (43.37)
2. Medium 7.96 (100) 4.50 (56.54) 3.46 (43.46)
3. Large 9.89 (100) 5.35 (54.10) 4.54 (45.90)
Sample Average 8.14 (100) 4.53 (55.78) 3.60 (44.22)
Figures in parentheses indicate percentage to total.
Table 5.2 shows the average size of families of the selected broiler producers along
with sex ratio. It is inferred from the above table that the number of males was higher as
compared to that of females in all three size groups. It was highest in small size group (56.63
per cent) followed by medium (56.54 per cent) and large (54.10 per cent) size groups. The
sample average number of males was 55.78 per cent and that of females 44.22 per cent. The
sample average of size of family was estimated as 8.14.
Age:
The age of the members of broiler producers family has a great influence on the
efficiency of the farm / hatchery operations. The age wise categorization of the family
members of the selected respondents had been depicted in the table 5.3 below.
Table 5.3: Age groups of different farm size groups
S. No. Size groupAverage size of
family (No.)
Age (Years)
Below 15 years 15-60 years60 years &
above
1. Small 6.94 (100) 1.97 (28.39) 3.85 (55.47) 1.12 (16.14)
2. Medium 7.96 (100) 2.05 (25.75) 4.96 (62.320 0.95 (11.93)
3. Large 9.89 (100) 3.13 (31.64) 5.19 (52.47) 1.57 (15.89)
Sample Average 8.14 (100) 2.33 (28.68) 4.61 (56.65) 1.19 (14.67)
Figures in parentheses indicate percentage to total.
Table 5.3 gives the age group (in years) of small medium & large size groups with
sample average. In the small size group with average size of family as 6.94, the maximum no.
of members were in the age group of 15-60 yrs (55.47 per cent) followed by below 15 yrs
(28.39 per cent) and 60 years & above (16.14 per cent). In medium size group with average
size of family as 7.96, 62.32 per cent were in the age group of 15-60 years, 25.75 per cent in
the age group of below 15 years and 11.93 per cent in the age group of 60 years & above.
Large size group with average size of family as 9.89, 52.47 per cent were in the age group of
15-60 years, 31.64 per cent in the age group of below 15 years and 15.89 per cent in the age
group of 60 years & above. In all the size groups maximum persons were seen in the age
group of 15-60 years due to the maximum range and this group also comprises of
experienced and trained broiler farmers. The services of children were utilized in watch &
ward and for feeding the broilers.
Education:
Literacy of the farm keeper and his family plays a pivotal role in the adoption of new
technologies, management of broiler farms and improved marketing practices as well as
strategies. The literacy of the respondent has been shown in table 5.4 below.
Table 5.4: Educational status of sample respondents
S. No.
Size group
Average size of family (No.)
Level of education (in percentage)Total
literacy (%age)
Total illiteracy (%age)
Upto high
schoolIntermediate Graduation
Post graduation
& above
1. Small 6.94 49.35 35.89 11.61 3.15 40.19 59.81
2. Medium 7.96 48.61 34.96 10.92 5.51 41.36 58.64
3. Large 9.89 46.12 33.83 10.61 9.44 42.82 57.18
Sample Average
8.14 48.02 34.89 11.04 6.03 41.45 58.54
Table 5.4 indicates the educational background of the selected broiler farm owners
and their families, It is clear from the table that the literacy level was highest in large size
group (42.82 per cent) followed by medium (41.36 per cent) and small (40.19 per cent) size
groups. The break-up of level of education shows that the maximum literates were having
education up to High school in all the three size groups (49.35, 48.61, 46.12 per cent
respectively). The sample average of respondents having education up to High school was
48.02 per cent, up to intermediate as 34.88 per cent, up to graduation as 11.61 per cent and up
to post graduation and above as 3.15 per cent. The sample average of total literacy of the
respondent in all the three size groups has been estimated as 41.45 per cent. Literacy level
was studied, as literate entrepreneurs minimized the cost of production by going on scientific
lines provided they are given adequate training in broiler keeping.
Economics of broiler production:
The cost of production / rearing is an important indicator being taken into
consideration by the Government of India while fixing support / procurement price for
various crops and commodities, but in case of broilers, prices tend to fluctuate of and on
because demand and supply factors come into operation. The cost of production varies from
region to region and even from farm to farm of a given region. The study of costs and returns
provides an idea of profitability of an enterprise and could be a yardstick to planners and
policy makers. Broiler production is continued whole year. One day old chicks take about 4-5
weeks to gain a weight of 1 kg or more, provided they are given appropriate feed, medicine
etc. and arc suitably taken care of. For the present study, the costs and returns have been
estimated for the whole year in all three size groups. It was observed in the field that broiler
farm owners use to raise one day old chick upto its slaughter age six times a year (2 each in
Summer, Winter and Rainy seasons).The life cycle wise cost of production in different size
groups which includes cost of poultry pen has been shown in subsequent tables and also with
the help of graph.
Table 5.5: Description of fixed assets of different size groups
(Beginning inventory value)
(Value of assets as on 2005 – 2006) (Rupees/Farm)
S. No. Particulars NumberSize Group Sample
AverageSmall Medium Large
1 Poultry Pen 1.00 50000.00 75000.00 100000.00 72916.66
2 Brooders 2.52 2450.00 5000.00 7051.14 4641.99
3 Feeders 10.77 1735.53 2342.50 3003.00 2307.53
4 Water troughs 8.89 850.75 1180.10 1418.55 1126.14
5 Water Tank 1.00 1500.00 1600.00 1800.00 1620.83
6 Buckets 7.04 306.72 824.00 928.74 660.56
7Water pump, Generator etc.
0.47 5015.77 9115.50 12260.62 8495.42
TOTAL 61858.77 95062.10 126462.35 91769.25
It is observed from the table 5.5 that in all the three size groups’ maximum capital
investment was on construction of Poultry house/Poultry Pen. The capital invested on poultry
pen was highest in all the three size groups. In the above table the different items which were
required to start poultry farm are brooders, feeders, water trough. Buckets, water tank, water
pump, generator etc.
Table 5.6: Detailed description of Farm inventory in all size groups
(Rupees)
S.No. ParticularsSize group Sample
AverageSmall Medium Large
1 Beginning inventory value 61858.77 95062.10 126462.35 91769.25
2 Depreciation 5623.50 8641.98 1 1496.54 8342.63
3 Ending inventory value 56235.27 86420.12 114965.81 83426.62
The average ending inventory value of all these items have taken after deducting
depreciation from average beginning inventory value. The average ending inventory value or
capital investment of small, medium and large groups came out to Rs. 56235.27, Rs.
86420.12, Rs. 114965.81 respectively, which is depicted in table 5.6. Depreciation on fixed
capital i.e. poultry pen and poultry equipments were calculated on a flat rate of 10 per cent
per annum.
Table 5.7: Cost incurred on raising broilers in different seasons for small farm size group
(Rupees)
S. No. Particulars
Summer season Winter season Rainy season
TotalAv. Cost per
broilerProduction cycle-I
Production cycle-II
Production cvcle-I
Production cycle-II
Production cycle-I
Production cycle-II
1. Hired labour charges1000.00 (4.95)
1010.00 (4.96)1000.00 (4.02)
1013.00 (4.03) 1000.00 (5.15) 1008.00 (5.13) 6031.00 (4.65) 2.68 (4.64)
2. Cost of chicks4202.00 (20.82)
4238.00 (20.84)4554.00 (18.32)
4604.12 (18.34)3795.00 (19.58)
3841.57 (19.57)25234.69 (19.48)
11.23 (19.48)
3. Cost of Sawdust etc. 267.70 (1.32) 270.05 (1.32) 286.97 (1.15) 296.05 (1.17) 248.75 (1.28) 251.75 (1.28) 1621.27 (1.25) 0.72 (1.24)
4. Cost of feed10814.00 (53.59)
10905.00 (53.63)
14855.00 (59.78)
15001.20 (59.76)10556.75 (54.41)
10695.10 (54.50)
72827.06 (56.24)
32.42 (56.24)
5. Medicine and vaccine charges 152.80 (0.75) 155.06 (0.76) 198.00 (0.79) 199.65 (0.79) 155.25 (0.80) 157.23 (0.80) 1017.99 (0.78) 0.45 (0.78)
6. Electricity and water charges 350.50 (1.73) 352.01 (1.73) 365.75 (1.47) 375.82 (1.49) 290.70 (1.49) 295.75 (1.50) 2030.53 (1.56) 0.90 (1.56)
7. Miscellaneous charges 150.00 (0.74) 151.06 (0.74) 167.78 (0.67) 172.72 (0.68) 145.50 (0.74) 150.02 (0.76) 937.08 (0.72) 0.41 (0.71)
8. Interest on working capital 677.48 (3.35) 683.24 (3.36) 857.10 (3.44) 866.50 (3.45) 647.67 (3.33) 655.97 (3.34) 4387.96 (3.38) 1.95 (3.38)
9. Depreciation on fixed capital 937.25 (4.64) 937.25 (4.60) 937.25 (3.77) 937.25 (3.73) 937.25 (4.83) 937.25 (4.77) 5623.50 (4.34) 2.50 (4.33)
10. Interest on fixed capital1124.70 (5.57)
1124.70 (5.53)1124.70(4.52)
1124.70 (4.48) 1124.70 (5.79) 1124.70 (5.79) 6748.20 (5.21) 3.04 (5.27)
11. Imputed value of family labour 500.00 (2.47) 505.00 (2.48) 500.00 (2.01) 508.00 (2.02) 500.00 (2.57) 506.00 (2.58) 3019.00 (2.33) 1.34 (2.32)
Total 20176.43 (100.00)
20331.37 (100.00)
24846.55 (100.00)
25099.02 (100.00)
19401.57 (100.00)
19623.90 (100.00)
129478.28 (100.00)
57.64(100.00)
Figures in parentheses indicate percentage to total.
Table 5.7: Cost incurred on raising broilers in different seasons for small farm size group
(Rupees)
S. No. Particulars
Summer season Winter season Rainy season
TotalAv. Cost per
broilerProduction cycle-I
Production cycle-II
Production cycle-I
Production cycle-II
Production cycle-I
Production cycle-II
1. Hired labour charges1000.00(4.95)
1010.00(4.96)
1000.00(4.02)
1013.00(4.03)
1000.00(5.15)
1008.00(5.13)
6031.00(4.65)
2.68(4.64)
2. Cost of chicks4202.00(20.80)
4238.00(20.84)
4554.00(18.32)
4604.12(18.32)
3795.00(19.58)
3841.57(19.57)
25234.69(19.48)
11.23(19.48)
3. Cost of Sawdust etc.267.70(1.32)
270.05(1.32)
286.97(1.15)
296.05(1.17)
248.75(1.28)
251.75(1.28)
1621.27(1.25)
0.75(1.24)
4. Cost of feed10814.00(53.59)
10905.00(53.63)
14855.00(59.78)
15001.20(59.76)
10556.75(54.41)
10695.10(54.50)
72827.06(56.24)
32.42(56.24)
5. Medicine and vaccine charges152.80(0.75)
155.06(0.76)
198.00(0.79)
199.65(0.79)
155.25(0.80)
157.23(0.80)
1017.99(0.78)
0.45(0.78)
6. Electricity and water charges350.50(1.73)
352.01(1.73)
365.75(1.47)
375.82(1.49)
290.70(1.49)
295.75(1.50)
2030.53(1.56)
0.90(1.56)
7. Miscellaneous charges150.00(0.74)
151.06(0.74)
167.78(0.67)
172.72(0.68)
145.50(0.74)
150.02(0.76)
937.08(0.72)
0.41(0.71)
8. Interest on working capital677.48(3.35)
683.24(3.36)
857.10(3.44)
866.50(3.45)
647.67(3.33)
655.97(3.34)
4387.96(3.38)
1.95(3.38)
9. Depreciation on fixed capital937.25(4.64)
937.25(4.60)
937.25(3.77)
937.25(3.73)
937.25(4.83)
937.25(4.77)
5623.50(4.34)
2.50(4.33)
10. Interest on fixed capital1124.70(5.57)
1124.70(5.53)
1124.70(4.52)
1124.70(4.48)
1124.70(5.79)
1124.70(5.79)
6748.20(5.21)
3.04(5.27)
11. Imputed value of family labour500.00(2.47)
505.00(2.48)
500.00(2.01)
508.00(2.02)
500.00(2.57)
506.00(2.58)
3019.00(2.33)
1.34(2.32)
Total 20176.43(100.00)
20331.37(100.00)
24846.55(100.00)
25099.02(100.00)
19401.57(100.00)
19623.90(100.00)
129478.28(100.00)
57.64(100.00)
Figures in parentheses indicate percentage to total.
Table 5.8: Cost incurred on raising broilers in different seasons for large farm size group
(Rupees)
S.No. Particulars Summer season Winter season Rainy season TotalAv. cost
per broilerProduction
cycle-IProduction
cycle-IIProduction
cycle-IProduction
cycle-IIProduction
cycle-IProduction
cycle-II
1 Hired labour charges4066.67 (4.96)
4102.50 (4.97) 4066.67 (3.87) 4215.90 (3.98) 4066.67 (5.24) 4040.50 (5.22)24558.91
(4.63)2.38 (4.63)
2 Cost of chicks16380.00 (19.99)
16416.22 (19.89)21769.00 (20.76)
22012.00 (20.81)
15400.00 (19.85)
15360.50 (19.86)
107337.72 (20.25)
10.40 (20.24)
3 Cost of Saw dust etc. 900.90 (1.09) 915.23 (1.10) 1088.45 (1.03) 1125.45 (1.06) 847.00 (1.09) 842.00 (1.08)5719.03 (1.07)
0.55 (1.07)
4 Cost of feed50859.90 (62.08)
51287.00 (62.15)66890.20 (63.79)
67237.70 (63.59)
47817.00 (61.66)
47692.50
(61.66)
331784.30
(62.61)
32.16
(62.60)
5 Medicine and vaccine charges 655.20 (0.79) 660.20 (0.80) 791.60 (0.75) 798.50 (0.75) 616.00 (0.79) 614.35 (0.79)4135.85
(0.78)0.40 (0.77)
6 Electricity and water charges 819.00 (0.99) 825.00 (0.99) 989.50 (0.94) 995.05 (0.94) 770.00 (0.99) 768.00 (0.99)5166.55 (0.97)
0.55 (0.97)
7 Miscellaneous charges 655.20 (0.79) 660.30 (0.80) 791.60 (0.75)801.60(0.75) 616.00 (0.79) 615.25 (0.79)
4139.95 (0.78)
0.44(0.85)
8 Interest on working capital2930.80 (3.57)
2994.6 (3.62) 3812.81 (3.63) 3887.45 (3.67) 2762.64 (3.56) 2757.32 (3.56)19145.68
(3.61) 1.85 (3.60)
9 Depreciation on fixed capital1916.09 (2.33)
1916.09 (2.32) 1916.09 (1.82) 1916.09 (1.81)1916.04(2.47)
1916.04(2.47)
11496.54 (2.16)
1.11 (2.16)
10 Interest on fixed capital2299.31 (2.80)
2299.31 (2.78) 2299.31 (2.19) 2299.31 (2.17) 2299.31 (2.96) 2299.31 (2.97)13795.86
(2.60) 1.33 (2.58)
11 Imputed value of family labour 433.33 (0.52) 438.05 (0.53) 433.33 (0.41) 441.67 (0.42) 433.33 (0.55) 430.50 (0.55)2610.21
(0.49)0.25 (0.48)
TOTAL81916.40
(100.00)
82514.61
(100.00)
104848.56
(100.00)
105730.72
(100.00)
77543.99
(100.00)
77336.27
(100.00)
529890.55 (100.00)
51.37
(100.00)
Figures in parentheses indicate percentage to total.
Table 5.7 gives cost incurred on raising broilers in different seasons for small size
group. Two production cycles were practiced in each season i.e summer, winter and rainy
season. Cost of feed accounted for maximum cost in all the seasons. Cost of feed accounted
for 56.24 per cent followed by cost of chicks (19.48 per cent). Total annual cost incurred in
small size group for raising broilers came out to be 1 lac 29 thousand.
Table 5.8 shows cost incurred on raising broilers in medium size group in a year. Cost
of feed accounted for maximum cost (59.67 per cent) followed by cost of chicks (19.91 per
cent). Total cost incurred for medium size group for raising broilers came out to be 2 lac 96
thousand. 1 able shows the fragmented production cycles, two each in different seasons
(summer, winter and rainy season).
Table 5.9 highlights cost incurred on raising broilers in large size group in a year.
Cost of feed and cost of chicks again accounted for maximum contribution in cost of
production nearly 80 per cent. Cost of feed calculated to be 62.61 per cent and cost of chicks
nearly 20 per cent.
Average cost per broiler was also calculated for all the three size groups and it was
Rs. 57.64, Rs. 56.45 and Rs. 51.37 in small, medium and large size group respectively.
Table 5.10: Cost incurred in different size groups for average farms in broiler production during a year (2005-2006)
(Rupees)
S. No. Particulars Size Group SampleSmall Medium Large Average
1 Hired Human Labour6031.00 (4.65)
15294.77 (5.16)
24558.91 (4.63)
14522.89 (4.81)
2 Cost of Chicks25234.69 (19.48)
58940.00 (19.91)
107337.72 (20.25)
60416.36 (20.01)
3Cost of electrical items, saw dust etc.
1621.27 (1.25)
3678.20 (1.24)
5719.03 (1.07)
3502.09 (1.16)
4 Cost of feed72827.06 (56.24)
176600.50 (59.67)
331784.30 (62.61)
182947.40 (60.62)
5Medicine & vaccine charges
1017.99 (0.78)
2284.555 (0.77)
4135.85 (0.78)
2349.55 (0.77)
6Electricity and water charges
2030.53 (1.56)
4199.35 (1.41)
5166.55 (0.97)
3668.14 (1.21)
7 Miscellaneous charges937.08 (0.72)
2627.75 (0.88)
4139.95 (0.78)
2434.80 (0.80)
8Interest on working capital
4387.96 (3.38)
10480.9(3.54)
19145.68 (3.61)
10723.30 (3.55)
9Depreciation on fixed capital
5623.50 (4.34)
8641.98 (2.92)
11496.54 (2.16)
8342.63 (2.76)
10 Interest on fixed capital6748.20 (5.21)
10370.40 (3.50)
13795.86 (2.60)
10011.16 (3.31)
11Imputed value of family labour
3019.00 (2.33)
2813.02 (0.95)
2610.21 (0.49)
2831.10 (0.93)
TOTAL129478.28 (100.00)
295931.51 (100.00)
529890.55 (100.00)
301749.42 (100.00)
Figures in parentheses indicate percentage to total.
It is inferred from the table 5.10 that the major item of cost incurred in broiler
production by all the three-size group of producers was amount spent on feed. It was the feed
responsible for the gain in weight of broilers which ultimately increased the income of
respondents. It was 56.24 per cent in small size group, 59.67 per cent in medium size group
and 62.61 per cent in size group large. Cost of chicks formed second major component in cost
of production. It is inferred from table that 19.48 per cent in small size group, 19.91 per cent
in medium size group and 20.25 per cent of amount in large size group was incurred on the
cost of chicks. Cost of chicks and feed accounted for nearly 80 per cent of the recurring
expenditure. In conformity to present study Shanmugam and Mohan (1997) in their study on
economic analysis of broiler production in Kamarayar district of Tamil Nadu revealed that
cost of feed alone accounted for more than 60% of the total cost followed by cost of chicks,
about 20%. Interest of working capital was calculated @ 4 per cent per year. Depreciation on
fixed capital i.e. poultry pen and poultry equipments were calculated on a flat rate of 10 per
cent per annum. Interest on fixed capital was calculated @ 12 per cent per year. There were
six production cycles practiced by farm owners in a year i.e two each in summer, winter and
rainy season. The total cost of production on average farm per year was calculated as Rs. 1
lac 29 thousand for small size group, Rs. 2 lacs 96 thousand for medium size group and Rs. 5
lacs 30 thousand for large size group.
Table 5.11: Average cost of production of broiler. (Rupees)
S. No. Size group 1Average cost of
production / farm/ year 2
Average no. of broilers/ farm/
year 3
Average cost of production/
broiler 4(2-3)
1 Small 129478.28 2246.00 57.64
2 Medium 295931.51 5242.00 56.453 Large 529890.55 10314.00 51.37
Average 301749.42 5597.83 53.90
It is inferred from table 5.11 that cost of production per broiler was higher for small
size group followed by medium and large size groups. This was also due to the higher
overhead charges per unit on smaller farms. In conformity to the present study, Murthy
(1986) in his study on resource productivity in agriculture observed that the cost of
cultivation per acre was highest for marginal fanners and the lowest for large farmers.
Table 5.12: Average cost incurred by different size groups.
S.No. Size GroupAverage weight per broiler (Kg)
Cost of production per broiler
(Rs)
Cost of Production per Kilogram (Rs)
1 Small 1.40 57.64 41.172 Medium 1.45 56.45 38.933 Large 1.48 51.37 34.70
Per kilogram cost was also calculated as broiler is sold in kilogram basis. It is evident
from the table 5.12 that average cost of production per kilogram of broiler was highest in
small size group followed by medium & large size groups. It was Rs.41.17, Rs.38.93 and Rs
34.70 for small, medium and large size groups respectively.
Week-wise cost of production was also calculated for a single broiler. As it was
observed from the field that five weeks were taken by broilers to gain a weight of 1 kg or
more. The week-wise cost of production per broiler is given in table 5.13.
Table: 5.13: Week-wise cost of production per broiler in different size groups.
(Rupees)
S. No. Size groupAge in weeks
Total1st 2nd 3rd 4th 5th
1 Small 16.26 10.15 11.51 10.13 9.59 57.64
2 Medium 15.13 10.25 10.32 10.81 9.94 56.45
3 Large 13.07 9.05 | 10.51 9.86 8.88 51.37
The cost of production per broiler is seen higher in small size group as compared to
medium and large size groups.
The hypotheses framed as “Large sized farm owners have relatively higher cost of
production as compared to medium and small sized farm owners” was tested by using
analysis of variance technique. Results indicated that the calculated value of F = 0.44 was
less than the table value of F = 3.88 at 5% level of probability with 2 & 12 degrees of
freedom. So it was concluded that there is non significant difference between the three size
groups and hence the hypotheses as framed is hereby rejected. (ANOVA table in appendix)
Returns from broilers
The returns from broilers include the main product i.e. sale of broiler (live or dressed),
by product (manures, gunny bags). Broiler producers brought one day chicks upto its sale ie.
1.00-1.50 kg/ broiler six times a year. So, the returns from this enterprise were quick and
continuous throughout the year. The present study is a study of one calendar year (2005-
2006). i.e from raising of one day chick to its slaughter age throughout the year. The results
of the returns analysis have been presented in the table 5.14 and also shown with the help of
graph (Fig.5.3&5.4)
Table: 5.14: Costs and returns of broiler for different size groups.
S. No. ParticularsSize Group Sample
AverageSmall Medium Large
1Average total cost of production (in Rs)
129478.28 295931.51 529890.55 301749.42
2Average number of broilers/farm (no.’s)
2246.00 1 5242.00 10314.00 5597.83
3Average weight per broiler (in kgs)
1.40 1.45 1.48 1.44
4Average price per broiler (in Rs)
66.74 66.00 65.85 66.23
5 Total value (in Rs.) 149898.04 345972.00 679176.90 369629.02
6 Value of manures (in Rs) 4059.50 6571.00 7685.50 5954.25
7Value of sale of gunny bags (in Rs)
1180.75 1782.50 2085.65 1645.26
8 Gross return (in Rs) 155138.29 354325.50 688948.05 377228.57
9 Net return (in Rs.) 25660.01 58393.99 159057.50 75478.93
10 Net returns/broiler (In Rs.) 11.42 11.13 15.42 13.48
It is inferred from table 5.14 that there were two types of returns from broiler
production i.e. one was main product and the other was by product. Main product includes
the sale of broiler, which is meant for consumption by consumers. The by-product includes
the manure which comes from the droppings of broiler while they are kept in poultry houses/
poultry pens. Gunny bags are also the sale of other items. It is observed from the table that
the gross return per farm was Rs. 155138.29 for small size group followed by Rs 354325.50
for medium and Rs. 688948.05 for large size group. Maximum returns comes from the sale of
main products. Net returns were calculated as Rs 25660.01. Rs 58393.99 and Rs 159057.50
for small, medium and large size groups, respectively.
The hypothesis framed as “Small size group farms have relatively higher profit than
medium and large size group farms” was tested by determining correlation and using “F”
statistic. The results indicted that calculated value of F =3.14 is less than the table value of F=
5.14 at 5% probability level with 2 and 6 degrees of freedom. It means there is non
significant difference between the three size groups. Therefore the hypothesis as framed is
hereby rejected.(ANOVA table in appendix)
Cost concepts and income measures
The cost of production of broilers in the study area has been further examined by
using the various cost concepts. These costs included cost A1, cost A2, cost B and Cost C. The
costs A1 and A2 have been combined to represent cost A the distinction of cost A1, and A2 had
no significance. The break-up of the total costs into cost A, cost B, and cost C has been
evaluated for each size groups. Different income / profitability measures were derived by
using cost concepts. The measures included net income, family labour income, farm business
income and farm investment income. Net income has been calculated by deducting cost C
from gross income. Farm business income has been calculated by deducting cost A1 and A2
from gross income. Family labour income was computed by deducting cost B from the gross
income whereas farm investment income was obtained by adding interest on fixed capital to
net income. The results are depicted on average farm basis and are presented in the tables
5.15-5.18.
Table 5.15: Measures of Cost concepts and farm profitability in small size group.
(Rupees)
S. No. Particulars
Seasons
Total
Summer season Winter season Rainy season
Production cycle I
Production cycle II
Production cycle I
Production cycle II
Production cycle I
Production cycle II
Measures of Cost concepts
1 Cost A1/A2 18551.73 18701.67 23221.85 23466.32 17776.87 17992.70 11971.08
2 Cost B 19676.43 19826.37 24346.55 24591.02 18901.55 19117.40 126459.28
3 Cost C 20176.43 20331.37 24846.55 25099.02 19401.57 19623.90 129478.28
Measures of Farm profitability/Income measures
1 Gross Income 26234.57 26501.53 26901.97 27702.85 23698.45 24098.89 155138.29
2 Net Income 6058.14 6170.16 2055.43 2603.83 4296.88 4474.99 25660.01
3 Farm Business Income 7682.84 7799.86 3680.12 4236.53 5921.58 6106.19 35427.21
4 Farm Investment Income 7182.84 7294.86 3180.13 3728.53 5421.58 5599.69 35427.21
5 Family Labour Income 6558.14 6675.16 2555.42 3111.83 4796.90 4981.49 28679.01
6 Benefit Cost Ratio 1.30:1 1.31:1 1.08:1 1.10:1 1.22:1 1.22:1 1.19:1
Table 5.16: Measures of Cost concepts and farm profitability in medium size group.
(Rupees)
S. No. Particulars
Seasons
Total
Summer season Winter season Rainy season
Production cycle I
Production cycle II
Production cycle I
Production cycle II
Production cycle I
Production cycle II
Measures of Cost concepts
1 Cost A1/A2 45414.88 45711.8 51919.15 52511.71 43415.59 43774.88 282748.09
2 Cost B 47143.28 47440.28 53643.55 54240.11 45143.99 45503.28 293118.49
3 Cost C 47609.94 47911.62 54114.21 54712.16 45610.65 45972.93 295931.51
Measures of Farm profitability/Income measures
1 Gross Income 58812.24 59604.24 61584.24 61980.24 55842.24 56502.24 354325.50
2 Net Income 11202.30 11692.62 7470.03 7268.08 10231.59 10529.31 58393.99
3 Farm Business Income 13397.36 13892.36 9665.09 9468.53 12426.65 12727.36 71577.41
4 Farm Investment Income 12930.70 13421.02 9198.43 8996.48 11959.99 12257.71 68764.39
5 Family Labour Income 11668.96 12163.96 7936.69 7740.13 10698.25 10998.96 61207.01
6 Benefit Cost Ratio 1.23:1 1.24:1 1.13:1 1.13:1 1.22:1 1.22:1 1.20:1
Table 5.17: Measures of Cost concepts and farm profitability in large size group.
(Rupees)
S. No. Particulars
Seasons
Total
Summer season Winter season Rainy season
Production cycle I
Production cycle II
Production cycle I
Production cycle II
Production cycle I
Production cycle II
Measures of Cost concepts
1 Cost A1/A2 79183.76 79777.25 102115.92 102989.74 74811.35 74606.46 513484.48
2 Cost B 81483.07 82076.56 104415.23 105289.05 77110.66 76905.77 527280.34
3 Cost C 81916.40 82514.61 104848.56 105730.72 77543.99 77336.27 529890.5
Measures of Farm profitability/Income measures
1 Gross Income 108832.31 | 110149.31 131221.31 132670.01 103169.21 102905.81 688948.05
2 Net Income 26915.91 27634.70 26372.75 26939.29 25625.22 25569.54 159057.50
3 Farm Business Income 29648.55 30372.06 29105.39 29680.27 28357.86 28299.35 175463.57
4 Farm Investment Income 29215.22 29934.01 28672.06 29238.60 27924.53 27868.85 172853.36
5 Family Labour Income 27349.24 28072.75 26806.08 27380.96 26058.55 26000.04 161667.71
6 Benefit Cost Ratio 1.32:1 1.33:1 1.25:1 1.25:1 1.33:1 1.33:1 1.30:1
Table 5.15 depicts measures of cost concepts and farm profitability in small size
group. Cost C in small size group came out to be Rs. 1 lac 29 thousand. Gross income was
calculated for different seasons and in total it was calculated as Rs. 1 lac 55 thousand with
Net income as Rs.25660.01. Farm Business income. Farm Investment income and Family
Labour income was also calculated per annum and it came out to be Rs.35427.21,
Rs.32408.21 and Rs.28679.01 respectively. Benefit-Cost ratio was calculated and it came out
to be 1.19:1.
Table 5.16 depicts measures of cost concepts and farm profitability in medium size
group. Cost C in medium size group came out to be Rs. 2 lac 96 thousand. Gross income was
calculated for different seasons and in total it was calculated as Rs. 3 lac 54 thousand with
Net income as Rs.58393.99. Farm Business income, Farm Investment income and Family
Labour income was also calculated per annum and it came out to be Rs.71577.41,
Rs.68764.39 and Rs.61207.01 respectively. Benefit-Cost ratio was calculated and it came out
to be 1.20:1.
Table 5.17 depicts measures of cost concepts and farm profitability in large size
group. Cost C in large size group came out to be Rs. 5 lac 30 thousand. Gross income was
calculated for different seasons and in total it was calculated as Rs. 6 lac 89 thousand with
Net income as Rs.l lac 59 thousand. Farm Business income, Farm Investment income and
Family Labour income was also calculated per annum and it came out to be Rs. 1 lac 75
thousand, Rs. 1 lac 73 thousand and Rs. 1 lac 62 thousand respectively. Benefit-Cost ratio
was calculated and it came out to be 1.30:1.
Table 5.18 Cost concept and measures of farm profitability per average farm.
(Rupees)
S.No. ParticularsSize Group Sample
AverageSmall Medium LargeMeasures of cost concepts
1 Cost A1/A2 119711.08 282748.09 513484.48 288907.32
2 Cost B 126459.28 293118.49 527280.34 298918.49
3 Cost C 129478.28 295931.551 529890.55 301749.60
Measures of farm profitability/income measures
1 Gross Income 155138.29 354325.50 688948.05 377228.54
2 Net Income 25660.01 58393.99 159057.50 75478.93
3 Family Labour Income 28679.01 61207.01 161667.71 78310.04
4 Farm Business Income 35427.21 71577.41 175463.57 88321.21
5Farm Investment Income
32408.21 68764.39 172853.36 85490.10
6 Benefit Cost Ratio 1.19:1 1.20:1 1.30:1 1.25:1
The different measured used to evaluate farm profit were net income, farm business
income, family labour income and farm investment income. Net income was calculated by
deducting cost C over gross income. Net income computed for small, medium and large size
group came out to be Rs 25660.01, Rs 58393.9 and Rs 159057.50 respectively (Table 5.18).
Farm business income calculated for small, medium and large came out to be Rs.35427.21,
Rs 71577.41 and Rs. 175463.57 respectively. Family labour income was calculated as
Rs.28679.01, Rs. 61207.01 and Rs. 161667.71 for small, medium and large size groups
respectively. Farm investment income was computed as Rs.32408.21 for small size group,
Rs.68764.39 for medium size group and Rs. 172853.36 for large size group. Farm business
income was highest followed by farm investment income among income/ profitability
measures in all the three size groups. Benefit Cost ratio calculated for all the three size groups
and it came out as 1.19:1, 1.20:1 and 1.30:1 for small, medium and large size groups
respectively. It will be further cross examined in capital productivity analysis.
Cost and returns per 100 broilers
Costs incurred and return analysis was also computed for 100 broilers in all the three
size groups as it may give an bird’s eye view to the entrepreneurs about the cost structure and
profitability in broiler enterprise. Likewise in the field crops cost and returns are calculated
on per hectare basis and it was felt necessary to calculate cost and returns on per 100 basis as
it will give uniformity to all size groups. In the following tables (“fable no.5.19, 5.20 and
5.21) measures of cost concepts and farm profitability have been calculated for small,
medium and large size group separately that too season wise and cycle wise. Results are
presented in the following tables.
Table 5.19: Measures of Cost concepts and farm profitability per 100 broilers in small size group.(Rupees)
S. No. Particulars
Seasons
TotalSummer season Winter season Rainy season
Production cycle I
Production cycle II
Production cycle I
Production cycle II
Production cycle I
Production cycle II
Measures of Cost concepts
1 Cost A1/A2 4857.47 4870.22 5864.10 5837.39 5152.71 5170.31 31752.20
2 Cost B 5150.89 5163.11 6148.11 6117.16 5478.71 5493.50 33551.48
3 CostC 5281.78 5294.62 6274.38 6243.53 5623.64 5639.05 34357.00
Measures of Farm profitability/Income measures
1 Gross Income 6903.83 6901.44 6897.94 6891.25 6929.37 6924.96 41448.79
2 Net Income 1622.05 1606.82 623.56 647.72 1305.73 1285.91 7091.79
3 Farm Business Income 2047.36 2031.22 1033.84 1053.86 1776.66 1754.65 9696.59
4 Farm Investment Income 1922.51 1899.71 924.02 940.61 1606.19 1578.80 8871.84
5 Family Labour Income 1752.94 1738.33 749.02 774.09 1450.66 1431.46 7897.31
6 Benefit Cost Ratio 1.30:1 1.30:1 1.08:1 1.10:1 1.22:1 1.22:1 1.19:1
Table 5.20: Measures of Cost concepts and farm profitability per 100 broilers in medium size group.
(Rupees)
S. No. Particulars
Seasons
TotalSummer season Winter season Rainy season
Production cycle I
Production cycle II
Production cycle I
Production cycle II
Production cycle I
Production cycle II
Measures of Cost concepts
1 Cost A1/A2 5184.34 5182.75 5674.22 5720.22 5230.79 5242.50 32234.82
2 Cost B 5381.65 5378.71 5863.12 5908.50 5439.03 5449.49 33420.50
3 Cost C 5434.92 5432.155 5914.12 5959.93 5495.25 5505.74 I 33742.11
Measures of Farm profitability/Income measures
1 Gross Income 6760.02 6757.85 6752.65 6751.66 6768.75 6766.73 40557.66
2 Net Income 1325.10 1325.70 838.53 791.73 1273.50 1260.99 6815.55
J Farm Business Income 1575.68 1575.10 1078.43 1031.44 1537.96 1524.23 8322.84
4 Farm Investment Income 1522.95 1521.66 1036.38 987.69 1471.35 1456.95 7991.31
5 Family Labour Income 1378.37 1379.14 889.53 843.16 1329.72 1317.24 7137.16
6 Benefit Cost Ratio 1.23:1 1.24:1 1.13:1 1.13:1 1.22:1 1.22:1 1.20:1
Table 5.21: Measures of Cost concepts and farm profitability per 100 broilers in large size group.
(Rupees)
S.No. Particulars
Seasons
TotalSummer season Winter season Rainy season
Productioncycle I
Productioncycle II
Productioncycle I
Productioncycle II
Productioncycle I
Productioncycle II
Measures of Cost concepts
1 Cost A1/A2 4834.17 4840.85 5159.97 5175.36 ! 4857.87 4850.87 29719.09
2 Cost B 4974.54 4980.37 5276.16 5290.90 5007.18 5000.37 30529.52
3 Cost C 5001.01 5006.95 5298.05 5313.10 5035.32 5028.36 30682.79
Measures of Farm profitability/Income measures
1 Gross Income 6685.03 6683.81 6667.74 6666.83 6690.61 6690.88 40084.90
2 Net Income 1684.02 1676.86 1369.69 1353.73 1655.29 1662.52 9402.11
3 Farm Business Income 1850.86 1842.96 1507.77 1491.47 1832.74 1840.01 10365.81
4 Farm Investment Income 1817.77 1816.38 1503.44 1493.25 1789.04 1802.04 10239.23
5 Family Labour Income 1710.49 1703.44 1391.58 1375.93 1683.43 1690.51 9555.38
6 Benefit Cost Ratio 1.32:1 1.33:1 1.25:1 1.25:1 1.33:1 1.32:1 1.30:1
Measures of cost concepts and farm profitability were also calculated per 100 broilers
in all the three size groups to give an idea about the profitability in broiler enterprise keeping
same yardstick for all the three size groups. Table 5.19 gives measures of cost concepts and
farm profitability per 100 broilers in small size group per year. Cost C was calculated and it
came out to be Rs. 34357.00. Gross income was computed and it came out to be Rs. 41448.79
with the net income as Rs. 7091.79. Farm Business income, Farm Investment income and
Family Labour income was also calculated per 100 broilers and it came out Rs. 9696.59,
Rs.8871.84 and Rs.7897.31 respectively. Benefit-cost ratio for small size group came out to
1.19:1.
Table 5.20 gives measures of cost concepts and farm profitability per 100 broilers in
medium size group per year. Cost C was calculated and it came out to be Rs. 33742.1 1.
Gross income was computed and it came out to be Rs. 40557.66 with the net income as Rs.
6815.55. Farm Business income, Farm Investment income and Family Labour income was
also calculated per 100 broilers and it came out Rs. 8322.84,Rs.7991.31 and Rs.7137.16
respectively. Benefit-cost ratio for medium size group came out to 1.20:1.
Table 5.21 gives measures of cost concepts and farm profitability per 100 broilers in
large size group per year. Cost C was calculated and it came out to be Rs. 30682.79. Gross
income was computed and it came out to be Rs. 40084.90 with the net income as Rs.
9402.11. Farm Business income. Farm Investment income and Family Labour income was
also calculated per 100 broilers and it came out Rs. 10365.81, Rs. 10239.23 and Rs.9555.38
respectively. Benefit-cost ratio for large size group came out to 1.30:1.
Table 5.22: Measures of cost concepts and farm profitability per 100 broilers.
(Rupees)
S.No. ParticularsSize Group Sample
AverageSmall Medium Large
Measures of cost concepts
1 Cost A1/A2 31752.20 32234.82 29719.09 31320.08
2 Cost B 33551.48 33420.50 30529.52 32626.41
3 Cost C 34357.00 33742.11 30682.79 33080.39
Measures of farm profitability/Income measures
1 Gross Income 41448.79 40557.66 40084.90 40753.94
2 Net Income 7091.79 6815.55 9402.11 7673.55
3 Farm Business Income 9696.59 8322.84 10365.81 9433.86
4 Farm Investment Income 8871.84 7991.31 10239.23 8977.15
5 Family Labour Income 7897.31 7137.16 9555.38 8127.53
6 Benefit-Cost Ratio 1.19:1 1.20:1 1.30:1 1.24:1
The measures of cost concepts and measures of profitability/income measures were
calculated for 100 broilers in all the size groups. Results reveal that cost incurred on raising
100 broilers or Cost C came out to be Rs. 34357.00, Rs.33742.11 and Rs.30682.79 on small,
medium and large size groups respectively (Table 5.22). Gross income calculated for small
size group came out to be Rs.41448.79, for medium size group as Rs.40557.66 and for large
size group as Rs.40084.90. Net income which was calculated by deducting cost C from gross
income and was found out to be Rs.7091.79, Rs.6815.55 and Rs.9402.11 for small, medium
and large size groups respectively. Farm business income, farm investment income and
family labour income was also calculated for all the three size groups and is depicted in table
no.5.22. Benefit Cost ratio was also calculated for all the three size groups.
Economic viability of broiler production or Capital productivity analysis:-
Economic viability or capital productivity analysis brings out the efficiency of capital
use in production. The different capital productivity analysis techniques are pay back period,
benefit-cost ratio, net present value and internal rate of return. Here only two techniques i.e.
benefit-cost ratio and net present value are depicted in table 5.21 and benefit-cost ratio is also
expressed in figure 5.5 (discounted as well as undiscounted)
Table 5.23: Benefit-cost ratio (BCR) and Net present value (NPV) in broiler production.
(Rupees per farm)
Size group
Total cost ofproduction
Benefit /Return
Discount co-efficient @
10%
Present value at 10% discounting
Cost Benefit
Small 129478.28 155138.29 0.909 117695.75 141020.70
Medium 295931.51 354325.50 0.909 269001.74 322081.87
Large 529890.55 688948.05 0.909 481670.51 626253.77
Small size group:
Benefit cost ratio = Present value of benefit divided by present value of cost
Present value of benefit = Rs 141020.70Present value of cost = Rs 1 17695.75Benefit cost ratio (BCR) at 10% discounting rate = 1.19: 1Benefit cost ratio (BCR) undiscounted = 1.19:1Net present value = Present value of benefit minus present value of cost.
= Rs 23324.95
Medium size group:
Benefit cost ratio = Present value of benefit divided by present value of cost
Present value of benefit = Rs 322081.87Present value of cost = Rs 269001.74Benefit cost ratio (BCR) at 10% discounting rate = 1.20:1Benefit cost ratio (BCR) undiscounted = 1.20:1Net present value = Present value benefit minus present value of cost
= Rs 53080.13
Large size group:
Benefit cost ratio = Present value of benefit divided by present value of cost
Present value of benefit = Rs 626253.77Present cost of cost = Rs 43 1670.51Benefit cost ratio (BCR) at 10% discounting rate = 1.30:1Benefit cost ratio (BCR) undiscounted = 1.30:1Net present value = Present value of benefit minus present value of cost
= Rs 144583.26
It is inferred from above calculations that the benefit cost ratio (BCR) was 1.19:1
undiscounted as well as at discounting rate of 10 per cent in small size group. The net present
value at 10 per cent discounting rate for small size group was Rs 23324.95 per farm. The
benefit cost ratio (BCR) for medium size group was computed as 1.20: 1 undiscounted as
well as at 10 per cent discounting rate. The net present value at 10 per cent discounting rate
came out to be Rs 53080.13 per farm for medium size group. For the large size group the
benefit cost ratio was calculated as 1.30: 1 for undiscounted as well as at 10 per cent
discounting rate. The net present value at 10 percent discounting rate was found to be Rs
144583.26 per farm in size group large.
MARKETING OF BROILERS
Agricultural marketing plays an important role not only in stimulating production and
consumption, but in accelerating the pace of economic development. Marketing also
innovates producer or entrepreneur to make necessary changes in marketing his produce. Its
dynamic functions are of primary importance in promoting economic development. For this
reason it has been described as the most important multiplier of agricultural development.
An efficient agricultural marketing system leads to the optimization of resource use
and output management. It also ensures higher levels of income for the farmers / producers /
entrepreneurs by reducing the number of middlemen or by restricting the commission on
marketing services and the malpractices adopted by them in the marketing of their
commodities. An efficient system guarantees the farmers/ producers better prices for their
commodities and induces them to invest their surplus in the purchase of modern inputs so that
production and efficiency may increase.
Broilers are considered important subsidiary occupation of Indian agriculture. Our
country has a great potential in increasing its production and it can be a good foreign
exchange earner by exporting dressed broiler to other countries. Most of the broilers
produced in Uttar Pradesh especially in study area, Allahabad district, finds its place in
restaurants, five star hotels, marriages, functions, parties and consumption outlets throughout
the state & other neighbouring slates like Madhya Pradesh, Bihar, Delhi etc.
Marketing of Broilers has been largely in the hands of private enterprises and there exists a
long chain of middlemen between the producer and ultimate consumer. The main marketing
agencies involved in the marketing of broilers in Allahabad district arc itinerant traders,
wholesalers, hotels and institutions and retailers. This whole process makes it complex for the
producer to increase his herd or to increase the number of birds for the reason being less
share of producer in consumer’s rupee.
The marketing functionaries expropriate a substantial proportion of the profit and both the
farm owner / producer as well as consumer suffer. The field study revealed that farm owners
largely sold their produce through itinerant trader, wholesalers, retailers and hotels and institutions
in descending order. The disposal of broiler through different agencies involved in the marketing of
broiler in the study area has been presented in table 5.22.
Table 5.24: Disposal of broilers through different agencies.
S.No. Disposal Agency No. of producers
1 Itinerant trader 22 (18.33)
2 Wholesaler 61 (50.83)
3 Retailer 27 (22.50)
4 Consumer (Direct sale) 10(8.34)
Total 120 (100)
Figures in parentheses indicate percentage to total
PRODUCER
ITINERANT TRADER
WHOLESALER
RETAILER
HOTELS & INSTITUTONS
CONSUMER
Marketing channels
The following channels were identified as the main marketing channels of broilers.
1. Channel I = Producer - Consumer
2. Channel 11 = Producer - Retailer - Consumer
3. Channel 111 = Producer - Wholesaler - Retailer - Consumer
4. Channel IV = Producer - Itinerant trader - Retailer - Consumer
5. Channel VI = Producer - Wholesaler-Hotels& Institutions - Consumer
Figure 5.6: Marketing mechanism model of broilers
CHANNEL WISE MARKETING COST, MARGINS AND PRICE SPREAD IN THE
MARKETING OF BROILERS.
The marketing cost, margin, producer’s share in consumer’s rupee and marketing efficiency
in different marketing channels of broiler, have been presented in the following tables.
Channels I: Producer - Consumer
Table 5.25: Marketing cost, margin, producer’s share in consumer’s rupee and
marketing efficiency of broilers.
S.No. Particulars Amount in Rs / kg
1 Producer sale price 55.00
2 Total expenses incurred by the producer 2.00
a) Cutting, Packing etc. 0.50
b) Weighing / Taulai 0.50
c) Miscellaneous charges 1.00
3 Net price received by producer 53.00
4 Producer’s share in consumer’s rupee (in percentage) 96.36
5 Index of marketing efficiency (shepherd’s method 27.50
It is inferred from the table 5.25 that the producers sale price for 1 kg of broiler (live)
was Rs 55.00 The total marketing cost borne by the producer was Rs 2.00. The producer’s
share in consumer’s rupee was worked out to be 96.36 per cent as it remained highest, as
there was no intermediary involved in this channel. However only 10 per cent of the
producers sold their produce / commodity through this channel in the study area. The
marketing efficiency by shepherd’s index method was calculated as 27.50. Marketing
efficiency was higher on account of low marketing expenses.
Channels II: Producer – Retailer – Consumer
Table 5.26: Marketing cost, margin, producer’s share in consumer’s rupee and
marketing efficiency of broilers.
S.No. Particulars Amount in Rs / kg1 Producer’s sale price 53.002 Total expenses borne by producer 3.75a) Transportation 1.25b) Weighing / Taulai 1.00c) Miscellaneous charges (packing, grading etc.) 1.503 Net price received by producer 49.254 Total expenses borne by retailer 2.75a) Taulai / Weighing 0.75b) Transportation 1.00c) Miscellaneous Charges (Packing, Handling etc.) 1.005 Retailer’s sale price 60.506 Net price received by retailer 57.757 Margin obtained by retailer 4.758 Producer’s share in consumer’s rupee (in percentage) 81.409 Index of marketing efficiency (Shepherd’s method) 5.37
The table 5.26 reveals that the producer’s selling price to retailer was Rs 53.00 for one
kg of broiler. The marketing charges borne by the producer were estimated as Rs 3.75. The
expenses incurred by the retailer were calculated as Rs 2.75 which included weighing
charges, transportation charges, packing and handling charges etc. Prod ucer’s share in
consumer’s rupee in this channel was 81.40 per cent. The marketing efficiency as calculated
by shepherd’s method was 5.37.
Channels III: Producer – Itinerant Trader – Retailer – Consumer
Table 5.27: Marketing cost, margin, producer’s share in consumer’s rupee and
marketing efficiency of broilers.
S.No. Particulars Amount in Rs/kg1 Producer’s sale price 50.002 Total expenses incurred by producer 2.00a) Taulai / weighing charges 0.50b) Handling charges i.e. labour etc. 1.00c) Miscellaneous charges 0.503 Net price received by producer 48.004 Itinerant trader sale price 54.755 Total expenses borne by itinerant trader 2.00a) Transportation 0.50b) Weighing charges 0.50c) Handling & packing charges 0.50d) Miscellaneous charges 0.506 Net price received by itinerant trader 52.757 Itinerant trader’s margin 2.758 Retailer’s sale price 62.259 Total expenses incurred by retailer 1.75a) Transportation 0.50b) Weighment charges / Labour charges 1.00c) Miscellaneous charges 0.2510 Net price received by retailer 60.5011 Retailers margin 5.7512 Producer’s share in consumer’s rupee (in percentage) 77.1013 Index of marketing efficiency (shepherd’s method) 4.36
The above table 5.27 indicates that the producer’s selling price to itinerant trader was
Rs 52.00 per kg. It is evident from the table that the retailer was earning reasonable margin in
this channel as he was offering services to consumers. The marketing charges borne by
producer were found out to be Rs.2.00, by itinerant trade were Rs. 2.00 and by retailer were
Rs. 1.75, which included weighing, transportation, handling and miscellaneous charges.
Producer’s share in consumer’s rupee in channel was 77.10 percent. The marketing efficiency
as calculated by shepherd’s method was 4.36.
Channels IV: Producer – Wholesaler – Retailer – Consumer
Table 5.28: Marketing cost, margin, producer’s share in consumer’s rupee and
marketing efficiency of broilers.
S. No. Particulars Amount in Rs/ kg
1 Producer’s sale price 52.50
2 Total expenses borne by producer 1.50
a) Transportation 0.50
b) Weighing / Taulai 0.50
c) Handling and labour charges 0.25
d) Miscellaneous charges 0.25
3 Net price received by producer 51.00
4 Wholesaler’s sale price 56.25
5 Total expenses borne by wholesalers 1.75
a) Transportation 1.00
b) Weighing / Taulai 0.25
c) Handling and labour charges 0.25
d) Miscellaneous charges 0.25
6 Net price received by wholesaler 54.50
7 Wholesaler’s margin 2.00
8 Retailers sale price 65.00
9 Total expenses incurred by retailer 3.25
a) Transportation 0.50
b) Weighing / Taulai 0.50
c) Handling and labour charges 1.50
d) Miscellaneous (storage) charges 0.75
10 Net price received by retailer 61.75
11 Retailer’s margin 5.50
12 Producer’s share in consumer’s rupee(in percentage) 78.46
13 Index of marketing efficiency (Shepherd’s method) 4.64
It is inferred from the table 5.28 that producer’s sale price to wholesaler was Rs 52.50
per kg. Net price received by producer was calculated as Rs 51.00 per kg after meeting some
expenses like transportation, weighing, handling and miscellaneous charges. Wholesaler’s
sale price to retailer was Rs 56.25. Net price received by wholesaler was Rs 54.50 after
incurring some marketing expenses. The consumers purchase price or retailer’s sale price was
Rs 65.00 per kg in this channel. Net price received by retailer was calculated as Rs 59.75
after incurring Rs 3.25 expenses on transportation, weighing, Handling, labour and
miscellaneous charges. The producer’s share in consumer’s rupee was calculated as 78.46 per
cent. The marketing efficiency calculated was 4.64 as calculated by shepherd’s index
formula.
Channel V: Producer-Wholesaler- Hotels and Institutions - Consumer
Table 5.28: Marketing cost, margin, producer’s share in consumer’s rupee and
marketing efficiency of broilers.
S. No. Particulars Amount in Rs/ kg
1 Producer’s sale price 54.00
2 Total expenses borne by producer 2.00
a) Transportation 0.75
b) Weighing handling charges 0.25
c) Labour charges 0.50
d) Miscellaneous charges 0.50
3 Net price received by producer 52.00
4 Wholesaler’s sale price 58.75
5 Total expenses borne by wholesalers 2.00
a) Transportation charges to hotel outlet 0.60
b) Weighing / Taulai 0.45
c) Handling, labour & packing charge 0.45
d) Miscellaneous charges 0.50
6 Net price received by wholesaler 56.75
7 Wholesaler’s margin 2.75
8 Hotel & Institution’s sale price 90.00
9 Total expenses borne by Hotel & Institution’s 15.75
a) Dressing & cooking charges 6.50
b) Handling and catering charges 5.75
c) Miscellaneous (storage) charges 3.50
10 Net price received by Hotel & Institution’s 74.25
11 Hotel & Institution’s margin 15.50
12 Producer’s share in consumer’s rupee (in percentage) 57.78
13 Index of marketing efficiency (Shepherd’s method) 2.36
It is inferred from the table 5.29 that producer’s sale price of live bird was Rs. 54.00
per kilogram, but the net price received by producer was Rs. 52.00,as Rs. 2.00 were his
expenses to be borne on weighing, transportation, handling charges etc. Wholesaler’s sale
price to hotels & institutions were Rs.58.75 after meeting expenses of Rs.2.00 on
transportation, weighing & miscellaneous charges. Wholesaler’s margin in this channel was
computed as Rs.2.75.Hotelier’s sale price to consumer was Rs. 90.00.The expenses borne by
Hotels was computed as Rs. 15.75 on dressing, cooking, catering and handling
charges. .Hotelier’s margin was Rs. 15.50. The producer’s share in consumer’s rupee was
calculated as 57.78 per cent. The marketing efficiency calculated was 2.36 as calculated by
shepherd’s index formulae.
Table 5.30: Price spread in different marketing channels of broilers.
S. No. ParticularsChannels
I II III IV V
A. Producer
INet price received by producer
53.00 (96.36)
49.25 (81.40)
48.00 (77.10)
51.00 (78.46)1 52.00 (57.78)
B Itinerant trader
1 Purchase price - - 50.00 80.32) - -
2 Marketing cost - - 2.00 (3.21) - -
3 Marketing martin - - 2.75 (4.41) - -
C. Wholesaler
1 Purchase price - - - 52.50 (80.76) 54.00 (60.00)
2 Marketing cost - - - 1.75 (2.69) 2.00 (2.23)
3 Marketing margin - - - 2.00 (3.07) 2.75 (3.05)
D. Hote1s & Institutions
1 Purchase price - - - - 58.75 (65.27)
2 Marketing cost - - - - 15.75 (17.50)
3 Marketing margin - - - 15.50 (17.23)
E. Retailer
1 Purchase price -53.00
(87.60)54.75
(87.95)56.25 (86.53) -
2 Marketing cost -2.75
(4.54)1.75 (2.81) 3.25 (5.00) -
3 Marketing margin -4.75
(7.85)5.75 (9.23) 5.25 (8.46) -
FPurchase price of consumer
55.00 (100)
60.50 (100)
62.25 (100) 65.00 (100) 90.00 (100)
G Gross price spread2.00
(3.63)11.25
(18.59)14.25
(22.89)14.00 (21.53)
38.00 (42.22) |
[
Figures in parentheses indicate percentage to purchase price of consumer.
Table 5.30 shows price spread in different marketing channels of broilers. Five channels
were studied for the present study. In first channel (Producer-Consumer), purchase price of
consumer was Rs. 55.00 with net price received by producer as Rs. 53.00,Rs. 2.00 as gross price
spread. In channel II (Producer-Retailer-Consumer), purchase price of consumer was Rs. 60.50,
with the gross price spread as Rs. 11.25. Net price received by producer in channel II was found
out to be Rs. 49.25. In marketing channel no III (Producer-Itinerant trader-Retailer-Consumer),
The gross price spread came out to be Rs. 14.25, with the purchase price of consumer as Rs.
62.25. The net price received by producer in this channel was Rs.48.00. Marketing channel no.
IV studied was Producer-Wholcsaler-Retailer-Consumer. In this channel purchase price of
consumer being Rs.65.00 with the gross price spread as Rs. 14.00. The net price received by
producer in this channel was Rs. 51.00. In channel no. V (Producer-Wholesaler-Hotels &
Institutions-Consumer), the gross price spread was Rs. 38.00, with the purchase price of
consumer as Rs.90.00. The reason for high purchase price of consumer as well as price spread
was due to high marketing cost and marketing margin incurred by hotels & institutions. The net
price received by producer in this channel (channel V) came out to be Rs. 52.00.
Table 5.31: Producer’s share in consumer’s rupee and marketing efficiency in different
marketing channels of Broilers.
ParticularsChannels
I II III IV V
Producer’s share in consumer’s rupee 96.36 81.40 77.10 78.46 57.78
Index of marketing efficiency (Shepherd’s index) 27.50 5.37 4.36 4.64 2.36
It is observed from the above tables that the maximum margins were taken by Hotels
and Institution followed by retailers. The maximum marketing costs were also incurred by the
same intermediaries. The gross price spread was highest in channel V, due to the fact the
huge marketing cost incurred by hotels and institutions in making broiler ready to serve to
consumers.
The producer’s share in consumer’s rupee was highest in direct channel i.e. Producer -
consumer (channel -I), followed by channel II, channel IV, and channel III (Table 5.31). The
producer’s share in consumer rupee was low in channel V, because of the huge margin
received by hotels and Institution as they also incur huge marketing cost.
It is also observed that as the number of intermediaries reduced, the marketing efficiency
increased. Chauhan (1999) also confirmed the findings that the price received by the producer
declined with the increase in the number of intermediaries in marketing channels. As the
produce or product moved from the wholesaler to distant markets, the marketing costs
increased and the marketing efficiency decreased.
The hypotheses framed as “producer’s share in consumer’s rupee is more in direct
channel (Producer- Consumer) than other channels was tested by using formulae of
producer’s share in consumer’s rupee and it was found that direct channel was having
producer’s share in consumer’s rupee of 96.36 per cent which was highest than other four
channels studied. Therefore the hypotheses as framed is hereby accepted.
The gross prices spread, producer’s share in consumer’s rupee and marketing
efficiency in different marketing channels of boilers hare also been shown with their help of
graphs (fig. 5.7, 5.8 & 5.9).
Constraints / problems in the production and marketing of Broilers
The various problems related to production and marketing of broilers faced by
producer’s, were identified and these have been presented in the tabular form below.
Table 5.32: Problems faced by Broiler farmers.
S.No. Problems/ConstraintsNumber of
respondentsPer cent
A. Production led constraints
1Non-availability of feed supplements during critical periods
93 77.50
2 No extension facilities 90 75.003 Inadequacy of poultry expert 88 73.304 Weak research base 49 40.845 Improper weighment 21 17.506 Lack of availability of quality chick breeds 95 79.177 Insufficient help from animal husbandry department 85 70.84
8No access to financial facilities particularly during initial years of establishment
101 84.17
9 No risk cover by government 32 26.67B. Market led constraints
1 No regulated market 35 29.172 Discouraging market mechanism 54 45.003 Lack of government intervention 98 81.674 Non-availability of credit facilities 75 62.505 Lack of storage facilities 25 20.846 Delay in payments 50 41.667 Price fluctuations 105 87.508 Insufficient export facilities 1 105 1 87.50 19 High cost of transportation 90 75.0010 No sale promotion schemes 80 66.67
Regarding the production side the broiler farmers were not given ample support from
the government led agencies, which included non-availability of one day old chicks timely
and at concessional rates. The producers were forced to procure chicks from private firms
that too on high rates. Chicken feed was not readily available to producers, as feed used to
play vital role in the weight gaining of broilers, which ultimately is directly proportional to
profitability of broiler farm owners. Outbreak of disease like bird flu etc. were also hurting
the producer’s interest as mere rumour about disease outbreak sharply declines the demand of
broiler meat consumption, which ultimately reduced the profit of producers. Producers
sometimes insure losses that too huge losses. These huge losses were not compensated by the
government led agencies. Risk involved in the enterprise was also seen a factor responsible
for disinterest of the entrepreneurs towards this trade/ enterprise. Low production of broilers
was also due to unawareness of the farmers towards raising of broilers on scientific lines.
They were still having hatcheries as well their broiler units based on traditional lines.
Among the market led constraints prices fluctuations was viewed as a core problem
by majority of the producers / respondents. The prices of broilers witness day to day
fluctuation, which was causing serious concern to producers and marketers. Discouraging
market mechanism and lack of government intervention was expressed as the serious
problem. Price fluctuations and insufficient export facilities were viewed by the farm owner
as other major problems.
Chapter-VI
Summary
&
Conclusion
SUMMARY AND CONCLUSION
The present study entitled, "Economics of Production and Marketing of
broilers in Allahabad district, Uttar Pradesh" was carried out with the following
specific objectives.
1. To work out the costs and returns in broiler production in different size
groups.
2. To evaluate the measures of farm profit in different size groups.
3. To study different marketing channels involved in the marketing of broilers.
4. To find out the producer's share in consumer's rupee,price spread and
marketing efficiency in different channels of marketing.
5. To study the problems faced by the broiler farmers of the selected area
and suggest suitable measure to curb them.
The research methodology consisted of multistage sampling design. In the
first stage, Allahabad district was selected purposively, as researcher was well
known to the area and also broiler farming is practiced on a commercial scale in
Allahabad district. It was followed by the selection of two blocks also purposively,
owing to their highest number of broiler farms. The blocks selected for the study
were Shankargarh and Chaka. In the third stage, the villages were selected. A list
of all the broiler rearing villages of Shankargarh and Chaka blocks were obtained
and arranged in ascending order according to their number of broiler farms.
Thereafter out of total thirty eight broiler rearing villages of block Shankargarh, a
sample of ten percent (4 villages) and out of total forty four broiler rearing villages
of block Chaka, a sample of ten percent (4villages) were selected randomly. In all
eight villages were selected from these two blocks, which formed the third stage
of sampling. In the fourth stage a complete list of all broiler farm owners of the
selected villages was obtained and they were categorized into three size group
on the basis of number of broiler farms. Small size group comprised of those
rearers having below 500 number of birds in their herd, medium group and large
group broiler farmers were those having 500 – 1000 birds, and above 1000 birds
respectively in their flock during the course of study.
A sample of ten percent (10%) of the broiler farm producers from each
selected village, thus a total of 120 broiler farm producers (small = 45, medium =
40, Large = 35) were randomly selected for the present study. This practice
formed the fourth stage of sampling. Finally, Allahabad market where broilers
were brought and sold was selected purposively. The different market
functionaries like Itinerant trader, Wholesaler, Co-operative society, Hotels and
Institutions, Retailer etc, were selected randomly.
Survey method was used for the collection of primary data. The producers
were contacted on regular visits and data were collected from them with the help
of pre tested and pre structured schedules. The secondary data was collected
from the records of the published records of the various concerned offices and
other relevant sources. The data pertained to the agricultural year 2005-2006 and
were tabulated, analyzed with the help of appropriate statistical / analytical tools.
The findings of the study revealed that whole year chicks were purchased
and raised upto its consumption. Two production cycles were being practiced in
every season i.e summer,winter and rainy season.The average size of broiler
farm owners with small, medium and large size group producers was 382, 876
and 1638 number of birds in one production cycle with cumulative total of 17190,
35040 and 57330 in one production cycle respectively. Similarly in winter season
it was 396, 915 and 1979 with cumulative total of 17820, 36600 and 69265 in one
production cycle for small, medium and large farms respectively and in rainy
season it was 345, 830 and 1540 with cumulative total of 15525, 33200 and
53900 in one production cycle for small, medium and large farms respectively.
Average size of family was 6.94, 7.96 and 9.89 in small, medium and large size
groups respectively. The number of males was higher than that of females in
each size group. The literacy percentage was higher in the case of third size
group, followed by second and first size groups. The maximum family members
were in the age group "15-60" years followed by below 15 years of age.
The results of economics of broiler production, revealed that for broiler
farm, the capital investment of Rs 56235.27,Rs 86420.12 and Rs 114965.81 was
incurred for small, medium and large size group respectively. Maximum share of
fixed investment is to be made on poultry house/ poultry pens. The results of
economics of broiler production calculated for one year, which include six
production cycles revealed that cost of production per broiler was higher for size
group first (small) followed by second (medium) and third (large) size group
indicating existence of economies of scale. The major item of cost was feed cost
which accounted for more than 60 per cent in all size groups followed by cost of
chicks which accounted for nearly 20 per cent in all the three size groups.
Therefore, feed and chick cost accounted for nearly 80 per cent of the total
recurring cost. Imputed value of family labour was also computed and hired
labour was engaged on pay roll basis/ monthly basis. The cost A, cost B, and
cost C were examined and studied.
The hypotheses framed as" Large size farm owners have relatively higher
cost of production as compared to medium and small size farm owners" was
tested and the results indicated that the hypothesis was rejected.
The results of the return analysis indicated that yields were maximum for
large size group followed by medium and small size group of main product. By
products like manures, gunny bags etc. also fetched higher price for large size
group followed by medium and small size group. Average weight per broiler was
found out to be 1.40 kg for small, 1.45 kg for medium and 1.48 kg for large size
group. The average price per broiler calculated was Rs 66.74, Rs 66.00 and Rs
65.85 for small, medium and large size groups respectively and average price of
Rs 47.67 per kilogram for first size group Rs 45.51 per kilogram for second size
group and Rs. 44.49 per kilogram for third size group. The higher price per
kilogram for first size group was due to the fact because they were selling the
produce directly to consumer .
The measures of farm profitability analysis indicated that the net income,
family labour income, farm business income and farm investment income was
positive on average basis. Net income calculated was Rs. 25660.01 for small size
group, Rs. 58393.99 for medium size farms and Rs. 159057.50 for large size
group farms. Family labour income came out to be Rs. 28679.01, Rs.61207.01
and Rs. 161667.71 for small, medium and large size groups,respectively. Farm
business income calculated was Rs. 35427.21, Rs.71577.41 and Rs.175463.57
for small, medium and large size group respectively. Farm investment income
was also computed and it came out to be Rs.32408.21, Rs.68764.39 and
Rs.172853.36 for small, medium and large size groups, respectively. Cost and
income measures were also calculated for 100 broilers in all the size groups and
the results were positive.
The hypothesis as framed “ Small size group farms have relatively higher
profit than medium and large size group farms” was tested and the results
indicated that the hypothesis is rejected.
Capital productivity analysis was carried out to evaluate the efficiency of
capital use in the investment project. Different measures to evaluate the
investment proposal are Pay Back Period (PBP), Net Present Value (NPV),
Benefit Cost Ratio (BCR) and Internal Rate of Return (IRR).
For The present study Benefit-cost ratio and Net Present value was
calculated. Benefit-cost ratio was found out to be 1.13:1 at 10 per cent
discounting rate as well as undiscounted for small size group, 1.14:1 at 10 per
cent discounting rate As well as undiscounted for medium size group and 1.24:1
at 10 per cent discounting rate as well as undiscounted rate for large size group
farm owners. Net Present value at 10 per cent discounting rate was higher at
Rs.116582.44 for large size group, Rs.38693.39 for medium size group and
Rs.15730.41 for small size group broiler farm owners.
Marketing of broilers was largely in the hands of private enterprises and
there existed a long chain of middlemen between the producer and ultimate
consumer. The main marketing agencies involved in the marketing of broilers
were Itinerant trader, Wholesaler, Hotel and institution dealers and Retailers. The
results revealed that 18.33 per cent of the selected respondants disposed off
their produce through itinerant traders. The Wholesalers were responsible for the
disposal of 22.50 per cent and 8.34 per cent of the total produce was sold
directly to consumer.
A number of marketing channels were identified that were involved in
marketing of broilers. Among them, five main channels were studied in detail. The
channel I (Producer-Consumer) was followed by ten per cent of the selected
respondents. Through this channel the producer’s share in consumer’s rupee
was estimated as 96.36 per cent. The marketing efficiency by Shepherd’s method
was calculated as 27.50.
The channel II (Producer-Retailer-Consumer) was followed by 18.92 per
cent of the selected broiler farm owners. Through this channel producer’s share
in consumer’s rupee was 81.40 per cent. The marketing efficiency calculated as
by Shepherd’s method came out to be 5.37. The retailer got a margin of Rs.4.75
per kilogram (7.85 per cent).
Through channel III (Producer-Itinerant trader-Retailer-Consumer) about
14.39 per cent of the respondents sold their produce. The producer’s share in
consumer’s rupee in this channel was estimated as 77.10 per cent. In this
channel itinerant trader got a margin of Rs.2.75 per kilogram and retailer got a
margin of Rs.5.75 per kilogram (i.e 4.41 per cent and 9.23 per cent for itinerant
trader and retailer).
The channel IV (Producer-Wholesaler-Retailer-Consumer) followed by
38.83 per cent of the selected respondent was studied and the results reveal that
wholesaler and retailer earned a margin of Rs.2.00 and Rs.5.50 per kilogram
respectively. The producer’s share in consumer’s rupee was 78.46 per cent and
marketing efficiency as computed by Shepherd’s index formulae was 4.46.
Channel V (Producer-Wholesaler-Hotels and Institutions-Consumer) was
practiced by 17.86 per cent of the selected respondents and the results reveal
Hotelier’s margin was Rs.15.50 although their marketing cost was high i.e
Rs.15.75 per kilogram. The reason of the high marketing cost and marketing
margin for the Hotelier’s was because it were Hotelier’s and different Institution’s
who incur much amount on broiler’s to make it ready to serve. The producer’s
share in consumer’s rupee in this channel was very low, which was 57.78 per
cent. The Shepherd’s index of marketing efficiency was 2.36.
It was observed that marketing margins and marketing cost’s were neck to
neck for all intermediaries except for Hotelier’s and Retailer’s. As in case of
Hotel’s and Institution’s marketing cost was higher as compared to marketing
margin, which was seen just opposite in case of retailers where marketing margin
was more or equal to marketing cost except in channel no II. As the production
cycle of broilers was very short , so, every marketing operation was very quick
and fast.
The hypothesis framed as “Producer’s share in consumer’s rupee is more
in direct channel (Producer-Consumer) as compared to other channels” was
observed and the results indicated that the hypothesis was hereby accepted.
Various production and marketing led problems were studied related to
production and marketing of broilers. Among the production led constraints
unavailability of feed, inferior quality of feed, inadequate medical facilities during
critical periods, weak research base on high yielding progenies, no access to
credit facilities for broiler farm owners and no encouragement from government
agencies for scientific rearing were serious problems opinioned by majority of
respondents. The serious market led constraint included lack of government
interventions in the marketing system, price fluctuations, no control on
intermediaries, no regulated market and no support from department of animal
husbandry.
CONCLUSIONS
The study on “Economics of Production and Marketing of Broilers in
Allahabad district of Uttar Pradesh” revealed that broiler production is
remunerative and offers ample scope for employment generation when it is
operated on a large scale. The economic analysis in terms of cost and returns,
Net Present value (NPV), Benefit-cost ratio (BCR) indicated that the broiler
farming is economically viable. It was also concluded that larger broiler farms are
better managed by trained people and give higher yields as compared to smaller
rearers. There is also a great scope for broiler industry’s development on a large
scale as there is huge domestic and foreign demand for broilers. Broilers can
also become an important source of foreign exchange earner. It was also
concluded that smaller and medium broiler farms are not economically viable as
compared to large size farms, as the law of economies of scale operates so it
was concluded that small and medium farms should be discouraged and if this
enterprise is to be started, it is recommended to start on a large scale.
SUGGESTIONS
Following suggestions have been made keeping in view the problem,
related to production and marketing of broilers faced by the producers of the
study area.
1). The broiler farm owners should increase the size of their business as they
can get the benefit of economies of scale.
2). As feed was the major input in the cost of production of broilers so, it is
recommended to have proper feeding management to increase the
income.
3). Adequate and timely institutional finance and the required inputs need to
be provided, particularly during the initial years of establishment of the
enterprise.
4). High yielding breeds of broilers should be made available to broiler farmer
through modern breeding techniques, which are virus resistant and can
withstand adverse conditions.
5). The production of broilers needs to be done on scientific lines so as to
increase the productivity and make this venture economically viable and
more profitable.
6). Since broiler industry involves a lot of risk ,as outbreak of any disease can
wipe out the whole flock. So, it was recommended and suggested to broiler
farm owners to insure their establishment against any untoward which can
keep the entrepreneurs on a safer side.
7). Training of poultry farmers is sine-quo-non of poultry enterprise. The
concerned department should come forward to train poultry farmers on up-
keeping their flock on scientific lines.
8). The recommended package of practices for broilers needs to be followed
for getting higher returns.
9). More farmers should be motivated to venture in this trade as broiler
production is having high economic returns.
10). Strong packaging of dressed broilers, particularly the export quality needs
to be done on scientific lines, which can prolong their keeping quality.
11) Marketing of broilers through proper channels needs to be encouraged like
co-operative societies which was lacking in the field.
12). Export facilities for broilers need to be strengthened as there is great
demand of dressed broiler in Gulf countries.
13). Creation of broiler marketing board, which can take care of both, marketing
of output as well as timely supply of inputs.
14). Extension activities needs to be strengthened, so as to guide the poultry
farmers about latest happenings around the world related to poultry
industry.
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SCHEDULE
Topic : Economics of Production and Marketing of broiler’s in Allahabad district of Uttar Pradesh
Table 1: Details about Allahabad District and Blocks (Shankargarh and Chaka)
S. No. Particulars Information in figuresDistrict Allahabad Block
ShankargarhBlock Handia
1 Total Area
2 Land under cultivation
3 Forest land
4 Total population
5 Total villages
6 Educational Institution
7 Health centres
8 Nyay Panchayat
9 Gram panchayat
10 Literates
12 Literacy percentage
13 Livestock population
14 Anganwadi centres
15 Mahila Mandal
16 Assembly constituency
17 Banks
18 Principal crops
Dr.Nahar Singh Hakeem Shabir Ahmad (Advisor) (Research Scholar)
Proforma A Name of the village :
Total area of the village :
Total number of broiler houses:
Major crops grown in village :
Method of marketing the produce :
Proforma BName of the village :
Table 2 : Study about the respondent/Producer Name of the producer
Age Sex Caste Primary occupation
Secondary occupation
Others (if any)
Table 3 : Details about respondent and his family
S.No. NameRelationship with
the headSex Age
Marital status
Literacy
Worker/non-worker
On farm
Outside farm
Table 4 : Educational Qualification
(Numbers)
Age group (in years)
Upto High school
Intermediate Graduation Post GraduationTotal workers on
farm
M F M F M F M F M F
Up to 15
20-60
60 and above
Table 5 : Details of broiler farms
Name of the respondent Total number of broilers Category Other enterprises
Table 6 : Credit
S.No Source Amount
(Rs)Rate of Interest
Amount unpaid
Utilization
Remarks
Broiler production
Agril purposes
Any other
A Institutional
BNon-
Institutional
Table 7 : Income from other sources (Rupees)
Category of the respondentIncome from secondary
occupationIncome from tertiary occupation (if
any)
Table 8 : Farm Inventory
No.
Particulars Qty. or number
Date/year of purchase/construction
Beginning Inventory value
Depreciation Ending inventory value
Remarks
FIXED ASSET
Poultry house
Land
Any other
BUILDING
Residence
Implement shed
Broiler house
Hatchery
Miscellaneous
LIVESTOCK
Bull
Cow
Goat
Buffalo
Any other
D. IMPLEMENTS AND MACHINERY (DEAD STOCK)
Feeder
Linear feeder
Feed hopper
Basket
Bucket
Jars
Water containers
Other machines
Table 9 : Month wise expenditure on broilers per production cycle (2005=2006).S.No. Particulars November December January February
Qty Value
Qty Value Qty Value Qty Value
A CATEGORY OF PRODUCER1 Number of
birds2 Feed3 Medicine 4 Electricity
charges 5 Water
charges6 Veterinary
fee7 Laboura) Family b) Hired8 Upkeep
charges 9 miscellaneou
sQty = quantity
Table 10 : Monthly loss of broilers during one production cycle (2005-06)
S.No. Particulars November December January FebruaryNo. P V No P V No P V No P V
1 UNDER HALF KGa. Diedb Culled2 ADULTS (ABOVE 1 KG)a Died b Culled
No. = Number, P = Price, V = Value
Table 11 : Output (Returns from main and by product of one production cycle)
S.No. Particulars Qty (no.)
Date and month of sale
Rate (Rs)
Amount (Rs)
Remarks
A MAIN PRODUCT1 Live broiler2 Dressed
broiler 3 Any otherB BY PRODUCT1 Litter 2 Gunny bags3 Eggs4 Any other
MARKETING SCHEDULE
General Information of the market :Location of the market :Ownership : Business Hours :Method of sale :
Table 12 : Market functionaries
S.No.
Market functionaries involved Percent share in broiler marketing
1 Producer2 Itinerant trader3 Co-operative society 4 Hotels and Institutions5 Wholesaler6 Government agency7 Retailer8 Department of Animal husbandry9 Any other functionary
Marketing channels followed for live poultry 1. Producer – Consumer
2. Producer – Itinerant trader – Consumer
3. Producer – Itinerant trader – Retailer – Consumer
4. Producer – Wholesaler – Retailer – Consumer
5. Producer – Retailer – Consumer
6. Producer – Hotels and Institutions – Consumer
7. Producer – Co-operative society – Retailer – Consumer
8. Producer – Co-operative society – Consumer
Table 13 : Study of producer (Broiler farm owner)Name of producer
Qty produced in kgs
Total quantity sold in kgs
Price per kg
Gross income
Charge paid by producer Net amount received (Rs.)
Transportation
Weighing
Handling
Other
Total
Table 14 : Study of Itinerant trader Name of itinerant trader
Qty. purchased in kgs.
Purchase price
Charges borne by itinerant trader Total quantity sold in kgs
Selling price per kg
Net amount received by itinerant trader
Transportation
Weighing
Storage
Handling
Other
Total
Table 15 : Study of wholesaler
Name of wholesaler
Qty purchased in kgs.
Purchase price per kg.
Charges borne by wholesaler Total quantity sold in kgs
Selling price per kg
Net amount received by wholesaler
Transportation
Weighing
Storage
Handling
Other
Total
Table 16 : Study of Co-operative society
Name of Co-operative society
Qty. purchased in kgs.
Purchase price per kg.
Charges borne by Co-operative society Total quantity sold in kgs
Selling price per kg
Net amount received by co-operative society
Transportation
Weighing
Storage
Handling
Other
Total
Table 17 : Study of Retailer
Name of retailer
Qty. purchased in kgs.
Purchase price per kg.
Charges borne by Retailer Total quantity sold in kgs
Selling price per kg
Net amount received by retailer
Transportat Weighi Stora Handli Oth Tot
ion ng ge ng er al
TESTING OF HYPOTHESES I: "Per bird cost of production was higher in first size group (small) as compared to second (medium) and third (large) size groups"
16.25= 11
= 121
5.67= 0.42
= 0.18
6.72= 1.47
= 2.16
7.50= 2.25
=5.06
8.24= 2.99
= 8.94
6.17= 0.92
= 0.84
g1=19.05 g12=362.90
13.50= 8.25
= 68.06
5.25= 0
= 0
5.70= 0.45
= 0.20
6.15= 0.90
= 0.81
7.25= 2
= 4
5.89= 0.64
= 0.40
g2=12.24 g22=149.81
12.23= 6.98
= 48.72
4.89= -0.36
= 0.13
5.00= -0.25
= 0.06
5.05= -0.2
= 0.04
6.13= 0.88
= 0.77
4.79= -0.46
= 0.21
g3=6.59 g32=43.42
6.23 0.06 1.67 2.95 5.87 1.1 G=37.88
C.F = G 2 = (37.88)2 = 1434.89 = 79.71 18 18 18 SS due to size groups = (19.05) 2 + (12.24) 2 + (6.59) 2 __ 79.71 6 = 362.90 + 149.81 + 43.42 __ 79.71 6 = 92.68 - 79.71 = 12.97
Total SS =xij2 - CF = 261.58 - 79.71 = 181.87
Error SS = 181.87 - 12.97 = 168.9
ANOVA TABLESource of variation
Deg. Of freedom
Sum of square
Mean sum of square
F value (calculated)
F (5%) table value
Remarks
Due to groups
2 12.97 6.48 0.57 3.68 N.S
Due to error
15 168.90 11.26
Total 17 181.87
TESTING OF HYPOTHESES II: "Third size group farms have relatively higher profit than second and first size group farms "
50.55= 18.52
= 342.9
70.49= 38.46
= 1479.1
19.94= -12.09
= 146.16
g1=44.89
(g1)2=2015.11
43.74= 11.71
= 137.12
75.76= 43.73
= 1912.3
32.03= 0
= 0
g2=55.44
(g2)2=3073.59
38.09= 6.06
74.50= 42.47
36.41= 4.38
g3=52.91
(g3)2=2799.46
= 36.72 = 1803.7 = 19.18G=153.24
C.F = G 2 = (153.24)2 = 23482.16 = 2609.16 9 9 9 SS due to size groups = (44.89) 2 + (55.44) 2 + (52.91) 2 __ 2609.16 3 = 2015.11+ 3073.59 + 2799.46 __ 2609.16 3 = 2629.38 – 2609.16 = 20.22
Total SS =xij2 - CF = 5877.36 - 2609.16 = 3268.20
Error SS = 3268.20 – 20.22 = 3247.98
ANOVA TABLESource of variation
Deg. Of freedom
Sum of square
Mean sum of square
F value (calculated)
F (5%) table value
Remarks
Due to groups
2 20.22 10.11 0.018 5.14 N.S
Due to error
6 3247.98 541.33
Total 8 3268.20