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