| Livestock Research for Rural Development 13 (1) 2001 | Citation of this paper |
Data from 61 broiler farms (each one comprising 6 flocks) located in Mardan Division, NWFP, Pakistan were collected during the year 1997-98 to investigate some factors affecting cost of production and net profit. Average cost of production and net profit per broiler were Rs.51.38±1.08 and Rs.7.92±0.85, respectively. Per cent mortality had a negative effect on net profit per broiler but did not affect cost of production. Market age and flock size were negatively and positively associated (b=-1.06±0.536; and b=0.734±0.127, respectively) with net profit. Net profit was lower when the flock size was less than 1500 birds. Cost of production was reduced in optimally utilised sheds, on concrete type floors and for broilers maintained under average hygienic conditions. Net profit per broiler was higher on concrete floors, and in optimally utilised sheds and from broilers maintained under good hygienic conditions. Higher flock size, reduction in mortality and in market age, better utilisation of the available shed capacity, appropriate hygienic measures and use of concrete floors were suggested as important factors for increasing net profit for broiler production in the subtropics.
Cost of production and net profit per broiler determine the fate of broiler productivity. Both are influenced by numerous factors, like market age, mortality, flock size, shed utilisation and hygienic conditions of the farm.. Higher market age and smaller flock size would narrow the margin between total gross income and net profit per broiler. Park and Joeng (1990) and Holsheimer and Veerkamp (1992) reported better overall performance of broilers marketed at the age of 6 weeks than at the age of 5th and 7th through 9th week. Mortality plays an important role in determining overall profitability of a flock. An increase in mortality from 2.5 to 10% reduced net profit per broiler (Kitsopanidis and Manos 1991). The present study was planned to study the effect of the aforementioned factors on cost of production and net profit per broiler in Mardan division.
Data from 61 broiler farms (each one comprising 6 flocks)
during the year 1997-98 were collected to study some factors affecting cost of production
and net profit obtained from broilers produced under subtropical conditions in open-sided
sheds. Information regarding flock size, shed capacity, floor type, hygienic conditions of
the farm, mortality, market age, total cost of production and net profit per broiler were
collected. Depreciation cost for equipment was calculated (at 20% per year over invested
capital) and added to total recurring cost of production. Building rent on actual reported
value for rented sheds and depreciation cost of the building for those farmers who owned
the sheds was taken on the basis of the rent and added to total cost of production.
The data were analysed, using relevant statistical techniques
of data analysis, namely, univariate, General Linear Model (GLM) procedures (Steel and
Torrie 1981) and multiple regression models.
To study the effect of hygienic conditions of the farm, shed
utilisation, flock size, market age, per cent mortality and floor type on total cost of
production per broiler, the following statistical model was used;
Yijklmno = µ + ai +bj +ck + dl
+ fm + gn + eijklmno
Where,
Yijklmno = the o-th observation on the total cost incurred on i-th flock
marketed at j-th age, maintained under k-th hygienic conditions on l-th type of floor,
utilised under m-th shed utilisation program and observing n-th mortality,
µ = Population
constant to all observations,
ai =
the effect of i-th flock size; i= 4 groups of flock size, ie: $1000 #1500, $1500 #2000, $2000 #2500 and above 2500
birds,
bj = the effect
of j-th market age in days; j= 3 groups of market age, ie: 38-42, 43-47 and above 47 days,
ck = the effect
of k-th hygienic condition; k was categorised as poor, average, good,
dl =
the effect of l-th type of floor; l= mud type, concrete, mud and bricks,
fm = the effect of
m-th shed utilisation program, m= over utilised, under utilised, optimally utilised,
gn = the effect of
n-th mortality in a flock; n= levels of mortality, ie: 0#3%, $3 #6%, $6 #10% and above 10%,
eijklmno = random residual term, assumed to be Normally
Identically Independently Distributed with mean zero and unit variance.
The effect of type of
hygienic conditions of the farm, flock size, market age, per cent mortality, shed
utilisation and floor type on net profit per broiler was also investigated using a similar
model.
The association of
various parameters, namely percent mortality, flock size and market age with total cost of
production and net profit per broiler was investigated using the following regression
model.
Y = b0
+ b1X1 + ai
Where, "Y" was response variable, "bi" the partial regression coefficients, "Xi" the independent variable, and "ai" was the residual term. Partial correlation of the independent variable with the predicted variable one by one was calculated as follows;
ri =
[bi / SEi] / [(bi / SEi)˛ + (n-k-1)]˝
Where, "ri" was the partial correlation coefficient of the
independent variable "i" with the response variable; "bi"
was the estimate of partial regression coefficient; "SEi" the
respective standard error of bi; "n" the number of observations and
"k" the number of independent variables in the model. The coefficient of
multiple determination "R2" was computed as follows,
R2 = (ry^y)2
Where R2
was the coefficient of multiple determination and ry^y was the correlation
between predicted and actual values. R2 was adjusted using the following
definition:
R2 (adjusted) = [(n-1)R2 - k] / [n-k-1]
Where "n" was the number of observations and "k" the number of independent variables in the model (Wonnacott and Wonnacott 1985).
Mean
total cost of production per broiler was Rs.51.38±1.08, whereas net profit per broiler
was Rs7.25±0.85 (Table 2). Net profit per broiler in the present study was higher than
that reported by Zahiruddin et al (1998: Rs.1.97) in district Swat and lower than that
reported by Mishra et al in India (1988: Rs.12.06). The present findings suggested a
reasonably good level of net profit per broiler in Mardan.
Per cent mortality had a negative effect (P<0.01) on net
profit and no effect on cost of production per broiler (Table 1).
Flock size had no effect on total cost of production and a positive effect (P<0.01) on net profit per broiler. Market age had a negative effect (P<0.01) on net profit per broiler but no effect on cost of production. Neither market age nor flock size influenced cost of production but were significantly associated with net profit per broiler (Table 1).
Table 1. Prediction of cost of production and net
profit per broiler in Mardan division from market age, per cent mortality and flock
size. |
||||||
Response variable (X0) for model 1 = Cost of production per
broiler |
||||||
Independent variables: |
||||||
Model 1 with R2 (adjusted) of 64.8% |
Model 2 with R2 (adjusted) of 66.93% |
|||||
Estimates |
Parameter Estimate±SE |
P |
r (partial) |
Parameter Estimate±SE |
P |
r (partial) |
b0 |
-1.76±3.0 |
0.06 |
- |
0.69±0.186 |
0.0002 |
- |
b1 |
1.042±0.2 |
0.512 |
0.64 |
-1.056±0.536 |
0.001 |
0.25 |
b2 |
0.03±0.3 |
0.068 |
0.862 |
-0.95±0.55 |
0.001 |
0.23 |
b3 |
1.038±0.1 |
0.001 |
0.084 |
0.734±0.127 |
0.003 |
0.39 |
Cost of production per broiler was at a minimum when mortality rate was less than 3% and increased when mortality rate increased from 6% to10% and above (Table 2). Net profit per broiler was higher (P<0.05) when mortality was less than 3% compared with 10% and above. Kitsopanidis and Manos (1991) also reported lower profits when per cent mortality increased from 2.5 to 10%.
Table 2. Mean comparison* of cost of production and
net profit per broiler in Mardan division |
||||
Particulars |
Cost of production |
Net profit |
||
Mean±SE (Rs.) |
CV (%) |
Mean±SE (Rs.) |
CV (%) |
|
a)
Per cent mortality |
||||
Up to 3% |
50.06a±2.84 |
35.5 |
13.12a±0.06 |
11.4 |
Up to 6% |
51.12a±3.92 |
58.1 |
11.08a±0.09 |
34.7 |
Up to 10% |
52.02a±3.49 |
51.5 |
4.95b±0.10 |
23.0 |
Above 10% |
52.23a±2.34 |
49.5 |
2.54c±0.11 |
16.0 |
b)
Flock Size (birds |
||||
1000-1500 |
55.19a±2.84 |
39.6 |
1.89d±0.06 |
18.9 |
1500-2000 |
53.95a±3.92 |
23.5 |
5.25c±0.09 |
45.4 |
2000-2500 |
49.73b±2.34 |
41.6 |
9.26b±0.10 |
37.3 |
Above 2500 |
47.08c±3.49 |
57.9 |
12.84a±0.11 |
56.9 |
c)
Market age |
||||
38-42 |
50.18a±1.34 |
25.6 |
12.13a±0.06 |
53.3 |
43-47 |
51.33a±3.92 |
34.6 |
6.94b±0.10 |
38.3 |
Above 47 |
52.62a±3.49 |
45.7 |
2.67c±0.11 |
18.4 |
d) Shed
utilization |
||||
Over utilised |
52.92a±2.50 |
18.4 |
6.64a±2.23 |
13.2 |
Optimally utilised |
49.90a±1.63 |
25.8 |
10.01a±0.05 |
22.3 |
Under utilised |
51.34a±1.18 |
12.9 |
7.12a±0.10 |
36.5 |
e) Hygiene |
|
|
|
|
Poor |
52.23a±1.58 |
23.8 |
5.49b±0.06 |
30.6 |
Average |
50.62a±1.92 |
13.2 |
7.98b±0.07 |
13.2 |
Good |
51.31a±1.73 |
21.2 |
10.29a±0.05 |
17.2 |
f) Floor
Type |
||||
Mud only |
51.68a±1.43 |
18.2 |
7.41b±0.05 |
26.7 |
Bricks and mud |
53.03a±1.66 |
21.4 |
5.61c±0.15 |
25.3 |
Concrete made |
49.43b±1.61 |
20.7 |
10.80a±0.07 |
22.6 |
Total: |
||||
|
51.38±1.08 |
22.2 |
7.25±0.85 |
89.0 |
* Means with different subscripts within the columns in each row
are different at P = 0.05 for each category in the table. |
||||
The reduced net profit per broiler at increased market age could be due to poorer feed conversion ratio and extra cost of management due to prolonged period of rearing. Thus, it appears to be more profitable to market broilers at an age earlier than 47 days.
Another study was conducted on optimal age of broilers at the time of marketing keeping in view cost of production, returns and meat quality and dry matter content of the carcass (unpublished data). Under conditions in Pakistan, 35.6 days and 1400 g liveweight were found to be the best options for marketing broilers.
In
Pakistan the market infrastructure is poor. Marketing of broilers is usually practiced
under two categories on a weight basis: birds weighing 1200-1400 g are sold and offered
with a higher price per kg liveweight than birds of higher weights. This makes a big
difference in marketing of broilers as the farmers are always trying to sell the broilers
before they attain a weight of 1400 or 1500 g.
The decreasing trend in cost of production and increasing trend in net profit per broiler with increased flock size could be attributed to the reduced overheads (miscellaneous, electricity charges, rent of the shed and labour) per bird.
The
relatively higher cost of production and smaller net profit in over-utilised sheds could
be attributed to poor hygienic conditions and over-crowding of the broilers resulting in
an unhealthy environment and stressful conditions leading to poorer performance. The poor
results in the under-utilised shed could be due to the higher proportion of the overhead
cost attributed to the relatively smaller number of broilers kept in the under-utilised
shed.
The
high cost of production per broiler maintained in poor hygienic conditions could probably
be due to increased mortality and diseases as a result of an unsatisfactory environment.
The slightly higher cost of production per broiler in sheds maintained under good
hygienic conditions as compared to the average hygienic condition could be attributed to
the extra cost of management and hygienic measures. Medicinal cost has three components:
disinfecting, prevention and therapeutic cost. The relatively higher cost of production
under good hygienic conditions as compared to the average hygienic conditions may be due
to the extra cost involved for maintaining good hygiene. However, the benefit of good
hygiene is reflected in the numerically higher gross income and net profit in response to
the good hygienic conditions as compared to the other two categories.
The relatively better performance of broilers on the concrete
floors could probably be due to increased management efficiency, better sanitation and a
more favourable environment resulting in the better performance and lower rate of
mortality, because well-finished floors are more easy to clean, maintain and disinfect
than poor or roughly finished floors. A floor having more cracks and crevices would not
ensure proper hygienic conditions and proper cleanliness of the debris after the flock is
being removed than a smooth or well finished concrete floor which could be washed,
disinfected and fumigated easily and effectively.
Holsheimer J P and Veerkamp C H 1992 Effect of dietary energy, protein and
lysine content on performance and yields of two strains of male broiler chicks. Poultry
Science 71(5) 872-879.
Kitsopanidis G and Manos H 1991 Evaluation of the degree of variation in
profitability of poultry meat production according to certain factors. Epitheorese
Zootenhnikes Epistemes. (14) 59-71.
Mishra M, Pattanaik G and Mohanty S N 1988 Economic efficiency
of poultry broiler farms of different sizes under hot, humid conditions. Indian Journal of
Animal Production Management. 4 (2) 87-91.
Park H K and Joeng E S 1990 Studies on the meat productivity
by the broiler breeds. Korean Journal of Animal Science 32(8) 504-513.
Steel R G D and Torrie J H 1981 Principles and procedures of
statistics; A biometrical approach. 2nd. Ed. McGraw-Hill, Singapore.
Wonnacott R J and Wonnacott I H 1985 Introductory statistics. 4th Ed. John Wiley & sons, New York. pp. 450.
Zahiruddin, Durrani F R and Farooq M 1998
Current Status of broiler production in Swat. Unpublished M.Sc. Thesis. Poultry Science
Department, NWFP, Agricultural University Peshawar. Pakistan. pp. 24
Received 9 October 2000