INTRODUCTION
Broiler meat is considered a major source of high quality animal protein, required
for growth and mental development. The negative impact of inadequate animal
protein intake is visible among the rural dwellers whose inhabitants constitute
over 70% of Nigerian population and over 85% of the extreme poor in the country
(Chukwuji et al., 2006). Broiler production provides
employment and regular income within the shortest time possible due to its fast
growth and shorter production cycle. However, reasonable returns can be guaranteed
only when produced at minimum cost of production because net profit is a function
of gross return and cost of production. Though minimum cost of production is
desirable to obtain higher returns, care must be taken so as not to be too rigid
so that the goal of producing soft, tender and high quality meat is not compromised.
According to Asghar et al. (2000) and Zahir-ud-Din
et al. (2001), smaller cost of production and higher returns are
key factors for higher profit in broilers.
In order to achieve higher returns therefore, necessary attention should be
paid to regular vaccination, sound production practices, maximization of available
resources and hygienic environment since broiler birds are more sensitive to
foul odour and contaminated environment. Khan et al.
(2004) posited that net returns in broiler production depends on market
age, delivered body weight, feed efficiency, mortality, flock size, optimal
rearing environment, immunization program and cost of production. There was
positive association between net profit and flock size (Farooq
et al., 2001) and negative association with mortality (Kitsopanidis
and Manos, 1991; Zahir-ud-Din et al., 2001).
This implies that net profit increases with flock size but decreases as mortality
increases. In effect, a larger sized farm is assured of larger profit in the
absence of high mortality rate. The age at which broilers are marketed also
plays an important role as to how much a farmer earns as his profit at the end
of the season. According to Kitsopanidis and Manos (1991)
and Farooq et al. (2001), profitability of broilers
decreased as the birds advanced in age. This may be due to the fact that more
of the feeds are converted to fat than meat, thereby eroding the profit margin
of the product since fat constitutes a waste at the slaughter house.
Two other important determinants of profit are cost of feeds and day-old chicks.
Kitsopanidis and Manos (1991), Asghar
et al. (2000) and Khan et al. (2004)
observed that feed accounted for 55-60% of the total cost of production. Efficiency
of feed consumption could be enhanced by reducing feed wastage to the barest
minimum. The feed cost is predicated upon the availability of raw materials
and this, in turn is dictated by the fluctuated weather conditions. With very
favourable planting season and good harvest, prices of raw materials are expected
to be reasonably low leading to lower cost of production and higher returns
for the farmers. But the reverse is the case when there are adverse weather
conditions during the year. The price of day-old chicks also fluctuates depending
on the demand which always reaches the peak during festive periods. For profit
maximization therefore, it is advisable that the rearing period coincides with
the time of either local or national festivals when there is high demand for
poultry meat. Alternative to this arrangement is for the farmer to monitor the
price of day-old chicks, purchase them when the price is low (Khan
et al., 2004).
There are different strains of broilers in the market. Some are fast growing,
while others are slow growing and poor converters of feed to meat. This present
investigation was carried out to compare the cost of production per kilogramme
of meat, gross margin and net profit for three strains of broilers commonly
reared in Nigeria. The main objective was to determine the strain of broiler
with the least cost of production, higher profit and productivity. The live
weight of the birds at maturity (8 weeks) were tested for significant differences
among the strains.
MATERIALS AND METHODS
The study was carried out at the Animal Breeding Unit, Teaching and Research
Farm, Ekiti State University, Ado-Ekiti, between September, 2010 and December,
2010. Ado-Ekiti is situated along latitude 7°31' and 7°49' North of
the Equator and longitude 5°71' and 5°27' East of the Greenwich meridian.
The city falls under the Derived Savannah zone. The city enjoys two separate
seasonal periods namely, Rainy (May-October) and Dry (November-April) seasons.
A total number of 150 broiler day-old chicks, that is, 50 chicks each of Arbor
Acres, Marshall and Hubbard were purchased from local hatcheries and raised
on deep litter in separate pens for 56 days (8 weeks). The chicks were brooded
using coal pot to supply heat for the first three weeks of life. Antibiotics
and vitamins were administered as and when due. Also, vaccines against infectious
bursae and newcastle diseases were given at specified age intervals. Their beddings
are made up of dry shavens to prevent coccidiosis outbreak and high level of
hygiene was maintained throughout the experimental period to ensure unhindered
conducive conditions for growth and to lower death rate. The birds were fed
ad libitum with starter mash (1-4 weeks) containing 22%CP, 3000 kcal kg-1
ME and finisher feed (5-8 weeks) containing 20%CP, 3100 kcal kg-1
ME.
At the maturity age of 56 days, the birds were numbered and weighed individually
on strain basis to obtain their live body weight after starving them overnight.
Data on input costs including veterinary services were recorded. These include
the costs of day-old chicks, feed, drugs medication and labour.
ANALYTICAL TECHNIQUES
Profitability of broiler production: The profitability of broiler production
was estimated using budget analysis and profitability ratios. The budget analysis
involves the deduction of the total variable costs (in US Dollars) from the
total revenue of live weight of broilers (in US Dollars) to obtain the gross
margin for each broiler strain. The total variable costs of production are the
cost of day old chicks, labor, feed, veterinary services, medication and other
miscellaneous expenses.
It is given by formula:
| Where: |
| GMi |
= |
Gross margin of strain i |
| Pi |
= |
Farm gate price per kg of meat of strain i |
| Yi |
= |
Total live weight in kg of meat of strain i |
| Ci |
= |
Total variable costs incurred on strain i |
| i....n |
= |
Total number of birds per strain i |
The profitability ratios include the Benefit Cost Ratio(BCR), the Profitability
Index (PI) and the Rate of Return on Investment (ROI). Due to equality in the
fixed costs across strains, they were not included in the analysis and the gross
margin was used as a proxy for net profit:
| Where: |
| TR |
= |
Total revenue (value of the total live weight of broiler) |
| TC |
= |
Total costs of production of broiler |
| NP |
= |
Net profit of broiler production |
Productivity of broiler production: To determine the average productivity
of the inputs used in production, four indicators were used to assess feed,
veterinary services, labor and cost productivities. These productivities are
estimated as.
| Where: |
| PF |
= |
Feed productivity |
| QF |
= |
Quantity of feed in kg |
| • |
Veterinary services productivity: |
| Where: |
| PVS |
= |
Veterinary services productivity |
| CVS |
= |
Cost of veterinary services in US $ |
| Where: |
| PL |
= |
Labour productivity |
| QL |
= |
Quantity of labour in man-days |
| Where: |
| PC |
= |
Cost productivity |
| TC |
= |
Total cost of production in US $ |
The Analysis of Variance (ANOVA) was employed to test the difference in mean
weight of different strains of broiler.
RESULTS
Production cost of broiler strains: The total production cost of the three
strains of broiler range between US$ 291.9 and US$296.8 (Table
1). There were no significant differences between the production costs of
the strains (p>0.05). Across the strains, the percentage contribution of
each cost item to the production cost was also not significantly different (p>0.05).
Overall, the cost of feed contributed the largest amount to the total production
cost, followed by cost of day-old chicks, while the cost of medication contributed
the least.
Weight at maturity of broiler strains: The Marshall strain had the highest
mean weight of 2.10 kg per bird (Table 2) with a standard
deviation of 0.38. The mean weight at maturity differs significantly (p<0.01)
between Marshall and the other two strains. This implies that despite no significant
difference in the cost of production, there exist a significant difference between
the mean weight of the Marshall strain and other strains at 1%. This shows that
while the production cost did not differ significantly, the mean weight shows
significant difference at 1% between Marshall and other strains.
However, there was no significant (p>0.05) difference between the mean weights
of Arbor Acre and Hubbard. The Marshall strain recorded the lowest cost of producing
1 kg of live weight broiler (Table 3). The difference between
Marshall and Arbor Acre was US$0.23, while it was US$0.19 between Marshall and
Hubbard.
| Table 1: |
Mean production cost in US dollars for different strains
of broiler |
 |
| Table 2: |
Mean weight (kg) at maturity for different broiler strains |
 |
| Table 3: |
Cost of producing 1 kg of broiler strains in US dollars |
 |
| Table 4: |
Costs and returns for the broiler strains in US dollars |
 |
| $1: N150 |
Profitability of broiler strains: Table 4 contains
the costs and returns of broiler production for the three strains. The Marshall
strain had the highest gross revenue per farm and per bird. This is followed
by Hubbard and lastly by Arbor Acre strain. The difference between Marshall
and Hubbard was $0.40 per bird, while between Marshall and Arbor Acre it was
$0.05. Due to similarity in their cost structure, the gross margin followed
a similar pattern as that of the gross revenue. The differences were significant
at the 5% level. At both the farm or bird level of analysis, the Marshall strain
recorded the highest gross margin.
Table 5 presents the profitability ratios for the broiler
strains. The Benefit Cost Ratio (BCR) for Marshall strain is 1.17 which implies
that it is more profitable to invest in the marshall strain than other strains
because for every $1cost incurred, the benefit acquired increases by $1.17 as
compared to Hubbard (1.10) and Arbor Acre (1.08). The rate of return on investment
for the three strains also follow similar pattern as in BCR. The ROI shows that
for every $1 invested in producing the three broiler strains, the Marshall strain
generated the highest return on investment by 17.5%. The profitability index
indicates that for every Dollar earned as revenue on Marshall Strain, 15 cents
is returned to the farmer as profit while it is 9 cents for Hubbard and 8 cents
for Arbor Acre. The ROI was highest for Marshall Strains with 17.5%, followed
by Hubbard 10.4% and Arbor Acre 9%.
The result of the profitability ratios revealed that there was no significant
difference (p>0.05) between Hubbard and Arbor Acre in the estimated performance
parameters, while there were significant differences (p<0.05) between Marshall
and Hubbard and between Marshall and Arbor Acre.
Productivity of broiler strains: In Table 6, the partial
productivities of production for the three broiler strains are presented. For
all the productivities estimated namely feed, veterinary services, labor and
cost; the Marshall strain ranked highest. For both Hubbard and Arbor Acre, the
labor and cost productivities were equal but slightly different for feed productivity,
as it was 0.01 higher for Hubbard than Arbor Acre.
| Table 5: |
Profitability ratios for the broiler strains |
 |
| Table 6: |
Productivity of production for broiler strains |
 |
It was also observed that although feed constituted the highest cost item in
broiler production, the feed productivities were not significantly different
(p>0.05).
DISCUSSION
The Marshall strain had the lowest cost of producing 1kg of meat and the highest
gross margin per bird and thus the most profitable to raise for commercial purposes.
This is followed by Hubbard, while the Arbor Acre strain has the least gross
margin. The profitability of broiler production depends also on the cost of
inputs which are cost of day-old chicks, feed, drugs, labour, veterinary services
and the sale price of matured birds. The costs of feed and day-old chicks were
the major items that significantly influenced the profitability of broilers.
Feed contributed 47-48% to the total cost of production and this was lower than
56-60% obtained in previous studies (Mian, 1994; Asghar
et al., 2000; Khan et al., 2004).
The reduction in the cost of production reported in this study was as a result
of the drop in the prices of inputs especially maize used in feed formulation.
The cost of day-old chicks constituted 24-25% of the total cost of production.
Asghar et al. (2000) and Khan
et al. (2004) observed similar contribution of cost of broiler chicks
to total cost of production. The cost of medication was 4% of the total cost
of production. This is consistent with the 4% reported by Asghar
et al. (2000) but higher than 3% observed by Khan
et al. (2004). The low medication cost was due to improved management
practices, good quality feeds and improved hygiene. There was no incidence of
disease outbreak throughout the period of the research and experimentation as
reflected by zero mortality. This also lends credence to the fact that broiler
production can be raised at with minimal cost provided necessary attention is
given to feeding and hygiene.
The BCR is lower than that reported by Mohsin et al.
(2008) for larger farm (1.34) while it is higher than that reported for
medium farm (1.10) and small farm (0.95). Also, the profitability indices is
lower than the findings of Ajala and Alli-Balogun (2004)
which was 0.43; Nworgu (2007) which range between 0.48-0.52.
In similar vein, the rate of return on investment is also lower than that reported
by Nworgu (2007) which range between 76.2-106.04%.
The profitability of broiler production depends on the strain of the birds,
costs of production, revenue and farm hygiene. The partial productivities were
highest for the Marshall strain and particularly for labor productivity.
CONCLUSION
There were no significant (p>0.05) differences in production costs among
the three broiler strains. Feed cost took the highest percentage of the total
cost of production, while medication was the least. Marshall strain had the
highest live weight at 8weeks and the least cost of producing 1kg meat. Marshall
also recorded the highest gross margin per bird and per farm. The productivities
are highest for the Marshall strain though not significantly different from
those of other strains. The Marshall broiler strain should be recommended to
farmers as the most cost efficient, productive and profitable strain.
ACKNOWLEDGMENT
The authors are grateful to the staff of Teaching and Research farm, Ekiti
State University, Ado-Ekiti for their effort, labour and support during the
experimental period.
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