| Livestock Research for Rural Development 26 (10) 2014 | Guide for preparation of papers | LRRD Newsletter | Citation of this paper |
The study was conducted in three districts of Bangladesh to know the viability and profitability of five different segments (chick rearer, key rearer, model breeder, mini hatchery and poultry worker) of the poultry model chain. In the poultry model chain the farmers are rearing Sonali chicken (a crossbred between Rhode Island Red × Fayoumi). A total of 178 beneficiaries of the five different segments were selected from the nine Upazila (sub district) under the three districts following simple random sampling technique. Designed structured questionnaires were used for data collection.
This study showed the viability percentage were 92 and 91 in Brahmanbaria and Sylhet districts, respectively in model breeding enterprise, which was the highest among the five segments. The viability of poultry keeping was 86% in Brahmanbaria, 71% in Shariatpur and 93% in Sylhet district. It was found that all the segments were profitable; however, among five segments, the benefit cost ratio (BCR) was highest for the key rearer.
Key words: benefit-cost ratio, breed, gender, scavenging, survivability
In developing countries including Bangladesh nearly all farmers (marginal, poor and landless) at the village level are owners of poultry, because it requires relatively low capital investments and rearing space. Furthermore, poultry are mainly owned and managed by women who constitute about 49% of the people of Bangladesh (BBS 2010). Besides poultry are often essential elements of female-headed households.
Poultry farming in Bangladesh is mainly a backyard type. It can play a vital role as a profitable business for the economic development of Bangladesh (Raha 2003). However, Sonali, a crossbred (developed by the crosses between Rhode Island Red (RIR) ♂ × Fayoumi ♀) was developed for the villagers. The Sonali produces higher number of eggs, 119/bird/year (Rahman et al 1997) and 131/bird/year (Khan et al 2007) under semi scavenging system than other purebred crosses e.g. RIR × Hilly (local) which produces 94 chickens/year (Khan et al 2007).
In the Bangladesh poultry model (FAO 2010), crossbred Sonali chickens are reared by the small-holder farmer for producing eggs. In this poultry model there are some segments such as: model breeder, chick rearer, mini hatchery, key rearer and poultry worker. However, nowadays it can be seen that there are some segments and / or farms that are not viable. Behind this non viability, the question could be raised: why this poultry chain is in vulnerable condition? Furthermore, whether all segments of this poultry chain are profitable, if yes, how much profit is obtained in each segment?
Therefore, in the consideration of the above facts the current study was conducted with the objectives: (i) to evaluate the viability of improved backyard poultry (Sonali) and the segments of the poultry model chain of Bangladesh; and (ii) to evaluate the profitability of different segments of the poultry model chain.
The study was conducted in the three districts (Shariatpur, Brahmanbaria and Sylhet) of Bangladesh, which were purposively selected by the consultation of Polli Karma Shayak Foundation (PKSF) project people and other Non Government Organizations (NGOs), which are involved in poultry rearing activities. Under the three districts, nine Upazilla (sub districts) namely, Shariatpur Sadar, Chikundhi, Damudda from Shariatpur district; Brahmanbaria Sadar, Sorail, and Nasirnagar from Brahmanria district; and Sylhet Sadar, Golapganj, and Balaganj from Sylhet district were chosen for this study. The study was conducted from October 2009 to July 2011.
Data on various processing, operating systems and economics on different enterprises were collected from structured questionnaire on direct visit to the farmer’s house by the data collector; direct interview was done according to the convenience of the respondents. At first, the project objectives and interviewees’ role were described to the respondents. If any item was overlooked and misunderstood or found contradictory, this was corrected through re-interviewing on spot. A total of 178 farmers from three districts (Brahmanbaria (22), Sylhet (82) and Sariatpur (74) were studied. There were 4 chick rearers, 7 key rearers, 4 mini hatchery, 7 model breeders from Brahmanbaria district; 4 chick rearers, 65 key rearers, 3 mini hatchery, 4 model breeders and 6 poultry workers from Sylhet district; and 5 chick rearers, 62 key rearers, 1 mini hatchery, and 6 poultry workers from Sariatpur district, that were investigated under the study. Samples were selected randomly after collecting the list of beneficiaries of different components of poultry development activities under Micro Finance and Technical Support (MFTS) project in the selected areas.
Viability of improved backyard poultry (Sonali) in the poultry model chain was estimated through collecting data from three study areas by direct interview using structured interview schedule. Viability percentage of poultry enterprises/farmers was calculated based on data provided by the NGO on the number of farms that are functioning as a proportion of those that were started at the beginning of different enterprises.
The profitability of different segments of the poultry model chain in Bangladesh was estimated from the costs and return of different components. The estimated cost and returns of different components are presented in Table 1.
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Table 1: Estimation of cost and returns of different component |
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|
Cost items |
Nature of cost |
|
Variable cost |
Cost of different inputs which are needed for operating a component (such as chick rearing, key rearing, model breeding etc.) cost items that are treated as variable costs are described below. |
|
Cost of day old chicks (DOC) and Pullet |
The cost of DOC refers to the cost at which DOC is purchased by the farmers from suppliers i.e. concerned NGO, mini hatchery. Price is set by the supplying farm and the farmers have nothing to do but to accept that price. The DOC was varied at the rate of US$ 0.328 to 0.357 per chick in three districts. Day old chicks are reared by the chick rearer for a period of eight weeks. Then the chick rearers sold these birds as pullet @ US$ 1.14 to 1.71 to the key rearer and model breeder in three districts. |
|
Labour cost |
Generally female members of the family were involved in the operation. The opportunity cost of labour was considered to estimate labour cost. Labour cost was calculated by using the prevailing wage rate (without food) of a female labour of respective area. Firstly, total working hour/ day and total working days per week. Eight working hours were equivalent to one man-day. Labour cost varied from US$2.86 to US$3.14 (1US$=Taka70) per man-day in three areas. |
|
Cost of feed and vitamin premix |
Feed costs included expenses associated with buying feed ingredients or processed feeds and other vitamins and premix. The feed cost per batch was calculated by multiplying the average amount of feed by the price per unit paid by the farmers in the study areas. |
|
Cost of medicine and vaccine |
This cost included cost of medicine, vaccine, and fees paid to poultry workers. Use of medicine and vaccine varied from farmer, components to components and also from area. Besides this the price of medicine and vaccine differed by different brands and doses. So this cost was estimated by taking into consideration of actual expenses incurred by the farmers. |
|
Cost of oil or electricity |
The cost incurred on fuel i.e. kerosene and electricity was calculated by taking into account of actual amount spent by the farmers. The cost incurred US$ 1.85- 5.0 per batch for mini hatchery. |
|
Cost of litter |
Litter management was one of the vital tasks of poultry rearing. The materials used as litter were saw-mill dust. Chick rearer and model breeder mainly used it. In this study litter cost was calculated by multiplying total amount (Kg) of litter used per batch with price of litter per kg. It can be noted that sample farmers collect litter as per bag (1 bag = 40 to 50kg) at the rate of US$0.88-1.0. In this study the average value was used. |
|
Interest on working capital |
Both the loan money and own fund was considered to estimate interest on working capital. Interest on own money was calculated at the rate of US$ 0.09% per annum in all the study areas considering the standard interest rate on saving bank account (US$ 0.09% per year). |
|
Fixed cost |
Cost on poultry houses and equipment were included under fixed cost. |
|
Cost of housing |
The cost of housing was calculated by taking into account the depreciation cost and interest on value of housing and maintenance cost. The production period of different components were considered in computing costs of depreciation and interest on capital invested by the concerned participants. |
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Cost of equipment |
Equipment is necessary for successful farming. In this study, cost of equipment was expressed as equipment cost, which was calculated by taking into accounts the depreciation cost and interest on value of equipment. |
The return items of chick rearer, key rearer and model breeder were birds and eggs sold at market price to the local poultry traders, neighbors and consumers. There was no formal market for excreta and litter and bags. So the actual average price received by the farmers was used to estimate the total return from these items. The total return on individual items was calculated on the basis of the number of eggs or birds sold multiplied by the average price of the concerned product. Birds were sold @ US$1.57 to 3.57 and day-old chicks @US$ 0.357. Unfertile eggs may be sold in the local market @ $0.11 (1 US$ = Taka 70).
The following profit equations were used to determine the profitability of different beneficiaries (under Micro Finance and Technical Support Project).
Profit (π) = PCBS + TVBP –ΣPxiXi -TFC
Where, Pc= price/unit
Bs=Number of pullet sold
TVBP= Total value of by-products
Pxi=per unit price of ith variable input
Xi= Quantity of ith input (i =1, 2, 3……… n)
TFC= Total fixed cost
Profit (π)= PC (BS + BC) + PC(ES+EC)+TVBP-ΣPxiXi -TFC
Where, Pc=Price/ unit
Bs=Number of bird sold
Bc=Number of bird consumed by the farm family
Es=Eggs sold
Ec=Eggs consumed by the farm family
TVBP=Total value of by-products
Pxi=Per unit price of ith variable input
Xi= Quantity of ith input (i =1,2,3, ……… n)
TFC=Total fixed cost.
Profit (π)= PCDOC +TVUE – ΣPxiXi-TFC
Where, Pc=Price/ unit
DOC= Number of DOC sold
TVUE=Total value from unfertile eggs
Pxi=Per unit price of ith variable input.
Xi= Quantity of ith input (i =1, 2, 3 ……….. n)
TFC=Total fixed cost.
Profit (π) = PSES –Pb - TEC
Where, Ps= Selling price of vaccine
Es=Number of poultry
TFC= Total fixed cost.
Pb=Buying price of vaccine
The collected data were edited and calculated as percentages by using Microsoft EXCEL. Data were analysed by using the statistical analytical software (SAS 2000). The following statistical model was used to estimate the mean with standard error of all the parameters. The model was:
Yijk = µ + Di + Sj + eijk
Where, Yijk is the parameter value, Di is the effect of district, Sj effect of segments in the poultry model chain, eijk is the random error distributed as N (0, σ2 ) .
The mean differences were compared using least significant difference (LSD) (Steel et al 1997) at 5% level of significance. The costs and benefits from different components were estimated by using Microsoft Excel.
The data on viability of different poultry enterprises (Table 2) indicated that the key rearer enterprise was highest (96%) among the five enterprises in Sylhet district. Similar features were observed in Shariyatpur district (86%). However, in Brahmanbaria district the viability percentage was highest in model breeder enterprise (88%). The variation between districts may arise due the differences in management, economic conditions of the farmers, marketing facilities, environmental conditions, source of chickens and price of feeds. There was no poultry worker enterprise activated in Brahmanbaria and no model breeder enterprise in Shariyatpur because poultry keeper, chick rearer, and model breeder acted as poultry workers as well. They rear poultry and vaccinate their poultry as necessary.
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Table 2: Viability of poultry enterprises in poultry model chain |
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|
Enter-prises |
Sylhet |
|
Brahmanbaria |
|
Shariyatpur |
||||||
|
NTE |
NSURE |
SUR (%) |
NTE |
NSURE |
SUR (%) |
NTE |
NSURE |
SUR (%) |
|||
|
MB |
9 |
4 |
44 |
8 |
7 |
88 |
1 |
0 |
0 |
||
|
CR |
7 |
4 |
57 |
5 |
4 |
80 |
7 |
5 |
71 |
||
|
KR |
68 |
65 |
96 |
10 |
7 |
70 |
70 |
62 |
86 |
||
|
MH |
4 |
3 |
75 |
5 |
4 |
80 |
2 |
1 |
50 |
||
|
PW |
7 |
6 |
86 |
0 |
0 |
0 |
8 |
6 |
75 |
||
|
NTE = No. of total enterprise, NSURE = No. of enterprise that were viable SUR%=Viability percentage; MB = Model breeder, CR = Chick rearer, KR = Key rearer, MH = Mini hatchery and PW = Poultry worker |
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Viability percentages of different enterprises in the poultry model chain are shown in Table 3. The information on mini hatcheries for viability was not available. The viability percentage was 92% and 91% in Brahmanbaria and Sylhet district, respectively in model breeding enterprise. The viability percentage of chick rearing enterprise was 80%, 74% and 85% in Brahmanbaria, Sylhet and Shariatpur district, respectively. On the other hand, the viability percentage of poultry keeping was 86% in Brahmanbaria compared to Shariatpur (71%) and Sylhet district (93%) (Table 3). However, no statistically significance differences (P>0.05) were found between the districts for each segment.
The average gross costs, net return per 100 eggs in mini hatchery operation in three districts is presented in Table 4. Net return for per 100 eggs was $16 in Sylhet and Branmanbaria but in Shariatpur it was US$8. The variation between districts may arise due the differences in management. Raha (2003) obtained the average net return per 100 eggs of Tk. 5.97 (US$0.08). The benefit cost ratios (BCR) of mini hatchery units was highest at 2.24 in Brahmanbaria and lowest in Shariatpur (1.50) district. The differences of BCR might be arisen due to the similar factors in districts are mentioned above. The BCR greater than 1.00 indicates the profitability of poultry farming. On the other hand, Raha (2003) observed BCR (1.01) per 100 DOC at Jhinaigati upazilla in Bangladesh , lower than the current study. However, Ahuja and Sen (2007) found BCR (1.60) for mini-hatchery enterprise in Bangladesh.
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Table 3: Comparison of viability of different enterprises in the poultry model chain |
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|
Districts |
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|
Brahmanbaria |
|
Sylhet |
|
Shariatpur |
|||||||||
|
KR |
CR |
MB |
PW |
KR |
CR |
MB |
PW |
KR |
CR |
PW |
|||
|
Viability (%) |
86±17.47 |
80±21.21 |
92 |
- |
93±13 |
74±25.34 |
91±17.0 |
96±4.8 |
71±27.49 |
85±10.67 |
92±7.53 |
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|
KR = Key rearer, CR = Chick rearer, MB = Model breeder and PW = Poultry worker |
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The return of chick rearing unit was derived from three sources: sale of pullets and excreta and used bags. The average net return per chick varied from US$ 0.4 to US$ 0.5 in three districts (Table 4). There were no significant differences found between districts for chick rearer unit. Alam (1997) and Saleque (2000) reported net return per week $6.55 for 50 chicks per batch in chick rearing unit. On the other hand, BRAC (1995) obtained net return per month for same enterprises of US$15. The BCR of 1.4 indicates that by investing $1.00 the return would be US$1.46. The benefit cost ratios of chick rearing units in different areas were more than 1.00 that shows the potential for chick rearing enterprises. Ahuja and Sen (2007) reported BCR of chick rearing unit was 1.29 whereas Raha (2003) found BCR 1.10 for the same enterprise.
The gross costs and net returns per bird and BCR of key rearing enterprises are shown in Table 4. The gross costs and net return in Brahmanbaria and Sylhet were similar and lowest in Shariatpur. The differences might have arisen due the price differences of day old chicks, feed cost and costs of electricity and labour costs. Alam (1997) and Saleque (2000) reported per week net return of US$0.83 for key rearing unit. On the other hand, BRAC (1995) obtained per month net return for same enterprise of $4.00. Ahuja and Sen (2007) and Raha (2003) reported BCR of chick rearing unit was 3.86 and 2.75, respectively for key rearing enterprise, which was similar with the current study.
No model breeder enterprise was
found in Shariatpur district. The average return of the model breeder farm
was derived from sales of eggs and birds (spent hens), litter and excreta and
also from sales of empty bags. Raha (2003) found BCR 1.14 and Ahuja (2007) reported BCR 1.52
for model breeder enterprises, which was similar with the current study.
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Table 4. Comparison profitability of different enterprises in Poultry Model Chain |
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|
Traits |
Districts |
SEM |
P value |
||
|
|
Brahmanbaria |
Sylhet |
Shariyatpur |
|
|
|
KR |
|||||
|
Gross cost /Bird |
4.00a |
4.00a |
5.00b |
0.211 |
0.0001 |
|
Net Return /Bird |
14.00b |
14.00b |
10.00a |
0.668 |
0.0043 |
|
BCR |
4.83 |
4.86 |
3.71 |
0.201 |
0.1071 |
|
CR |
|||||
|
Gross cost /Bird |
1.00 |
0.90 |
1.00 |
1.175 |
0.2282 |
|
Net Return /Bird |
0.50 |
0.40 |
0.50 |
0.063 |
0.4980 |
|
BCR |
1.46 |
1.42 |
1.59 |
0.094 |
0.6014 |
|
MB |
|||||
|
Gross cost /Bird |
11.00 |
11.00 |
- |
1.203 |
0.2321 |
|
Net Return /Bird |
1.30 |
1.20 |
- |
0.76 |
0.4290 |
|
BCR |
1.12 |
1.11 |
- |
0.060 |
0.5120 |
|
MH |
|||||
|
Gross cost /100 eggs |
13.00 |
16.00 |
16.00 |
1.450 |
0.4990 |
|
Net Return /100 eggs |
16.00 |
16.00 |
8.00 |
1.658 |
0.1925 |
|
BCR |
2.24b |
2.03b |
1.50a |
0.216 |
0.0213 |
|
PW |
|||||
|
Gross cost / month |
- |
5.00b |
2.00a |
1.351 |
0.0023 |
|
Net Return / month |
- |
7.00 |
6.00 |
5.345 |
0.3250 |
|
BCR |
- |
2.38 |
3.62 |
0.890 |
0.2400 |
|
KR= Key Rearer, CR= Chick Rearer, MB= Model Breeder, MH =Mini Hatchery, PW= Poultry Worker, BCR=Benefit Cost Ratio,[NB: In case of
MH, per batch = 21 days, In case of CR, per batch=2 months, In case of KR, per batch=1 year, In case of MB, per batch=1 Year]
|
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No poultry worker enterprise was found in Brahmanbaria district because poultry keeper, chick rearer, and model breeder perform as poultry workers in this area. They rear poultry and vaccinated them as necessary. The poultry worker worked six days per week and maximum 6 months per year. They charged fees of US$0.01 to US$0.04 per bird. The highest net return per month was found in Sylhet and lowest was in Shariatpur. According to Alam (1997) and Saleque (2000) per week net profit was US$2.4. BRAC (1995) found per month net profit was US$3 for poultry worker enterprises. The BCR for poultry worker was 2.38 in Sylhet district whereas it was 3.62 in Shariatpur district. However, Raha (2003) obtained lower BCR 1.40 for this enterprise than the current study.
On an average the net return and BCR was higher for key rearers than chick rearer and model breeder in all three districts. The reasons for highest BCR for key rearer were probably lowest rearing cost due to short period of rearing and low investment for feeds and labour. Raha (2003) also reported the highest BCR in key rearer (2.75) unit and the lowest BCR in chick rearer unit (1.10). Ahuja and Sen (2007) reported similar observation as Raha (2003). On the other hand, in mini hatchery net return was found to be higher than in all the other segments of the poultry model chain but BCR was moderate. It was found that all the components of the poultry model chain was found to be beneficial. However, among five components ,BCR of key rearer was the highest in Sylhet district compared to Brahmanbaria and Shariatpur district. The BCR of all enterprises (chick rearer, key rearer, and mini hatchery, poultry worker) among three areas was highest in Sylhet district compared to the other two.
The present study revealed that most of the components of the poultry model chain were viable and profitable.
Combined farming with more than one enterprise of the poultry model chain was more profitable than the single enterprise.
The authors are grateful for financial support from Palli Karma Sahayak Foundation (PKSF), Bangladesh which has been financed by IFAD (International Fund for Agricultural Development) to conduct this study. The authors are also grateful to the farm owners in the studied areas for providing the data.
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Received 11 October 2013; Accepted 17 September 2014; Published 3 October 2014