A Comparative Profitability Analysis of Broiler Production Systems in Urban Areas of Edo State, Nigeria
CHAPTER ONE
OBJECTIVES OF THE STUDY
The broad objective of the study is to carry out a comparative cost analysis of broiler production systems in the urban areas of Edo State.
The specific objectives are to;
- examine the socio-economic profiles of the broiler farmers in the study area.
- identify the different systems and cost components of each system.
- examine and compare the profitability of different systems of broiler production.
- examine the relationship between cost of input used by respondents and income realized under the different production systems;
- identify constraints to broiler production in the study area.
CHAPTER TWO
REVIEW OF RELATED LITERATURE
LIVESTOCK RESOURCES OF NIGERIA
Although there is no reliable estimate of livestock population in Nigeria; information available on the Nigerian livestock resources survey on FAO website, reported that Nigeria has approximately 13 million cattle, over 56.6 million goats and sheep, over 3.5 million pigs and over 130 million poultry.(RIM,1992)
These animals are distributed throughout various ecological zones in the country with greater concentration of each type in a particular zone than others. According to available literature from Nigerian livestock resources(RIM,1992), 95% of the cattle population is found in the Sudan Savannah, 3% in the Guinea Savannah or middle belt and the remaining 2% in the Southern rainforest belt. The small ruminants’ enterprise such as goats, sheep, and pigs are subject to structural adaptations to environment. The poultry enterprise made up of chicken, ducks and geese, guinea fowl, turkey and pigeon constitute a foot-loose industry that is structurally suited to any ecological condition, chickens are by far the most typically maintained under traditional, low-input free-range systems of management, but substantial numbers are also reared intensively on commercial basis.
Although livestock are kept in different part of the country for a variety of purposes, the production for meat predominates. A large amount of protein and mineral elements are obtained from animal products such as meat, milk, and milk products and eggs (Abioye 2000).
Poultry
Poultry outnumbers all the other forms of livestock in Nigeria, and, not surprisingly, is found throughout the country, wherever there is human settlement. Although pigeons, ducks, guinea fowl and some turkeys are also widely kept, chickens are by far the most common. Typically they are maintained under traditional, low-input, free-range systems of management, but substantial numbers are also reared intensively on a commercial basis, particularly in the southern states. Commercial holdings account for some 10 million chickens, or 11 percent of the estimated population of 82.4million (watch 2006).
There was a boom in intensive chicken production in the early 1980s, when the government subsidized the prices of day-old chicks and feed ingredients. As the subsidies have now been withdrawn, however, both extensive and intensive commercialized production have tended to decline, especially in urban areas, despite the continued demand for chicken meat and eggs .The major constraint on traditional chicken production is Newcastle disease, which affects local breeds in particular, while for more intensive commercial producers it is availability of feeds and drugs that is limiting.
CHAPTER THREE
RESEARCH METHODOLOGY
STUDY AREA AND SCOPE
The study was conducted in Edo State of Nigeria. Edo State is located in the Southern rainforest region of the country. The State lies within the geographical coordinates of latitudes 050 44′ N and 070 34′ N and longitudes 060 04′ E and 060 43′ E. Two distinct seasons are noticed in the State – the rainy season (March – September) and the dry season (October – February). Relative humidity of the State is high; about 80 – 90% throughout the year. This climatic condition is favorable to poultry production. Emokaro and Eigbirhemonlen (2012)
Edo State is made up of eighteen (18) Local Government Areas (LGAs) with a total landmass of 19,187sq km, and an estimated population of 3,926,587 million people using the projected annual growth rate of 2.7% (NPC, 2006). On the basis of Edo State Agricultural Development Programme (EADP) delineation, it is divided into three agro-ecological zones namely Edo South made up of seven LGAs, Edo Central made up of five LGAs and Edo North made up of six LGAs.
CHAPTER FOUR
RESULT AND DISCUSSION
ASSESSMENT OF THE SOCIO-ECONOMIC PROFILES OF THE BROILERS FARMERS
The socio-economic profiles of the farmers studied included their age, marital status, sex, family size, educational level and farming experience. These were analyzed in relation with the production systems practised by respondents.
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATIONS
The study was a comparative profitability analysis of broiler production systems in urban areas of Edo State, Nigeria.
SUMMARY
The two main production systems in the study area are the battery cage and the deep litter system, with the deep litter system of production being the most prevalent with 71.56%.The socio-economic characteristics of respondents reveals an average age of 48 years for those practicing the battery cage system with a mean family size of 6 and 7 years of poultry farming experience; while the deep litter production system farmers had an average age of 46 years and a family size of 4 and 7 years of poultry farming experience. Over 60% of farmers who practice both the battery cage and deep litter production system had tertiary education. The Gross Margin analysis gave a value of N2, 422.24 and a Net Farm Income (NFI) of N2,412.40 per bird for battery cage system while the deep litter system had a gross margin of N1,601.77 and NFI of N1,593.80 per bird. The profitability ratios showed Rate of Return on Investment RRI (91.69%), Return on Labour RL (N18.03), Return on Feed RF (N144.22) and Return Per Naira invested RNI (N0.91) for the battery cage system as against Rate of Return on Investment RRI (70.74%), Return on Labour RL (N30.28), Return on Feed RF (N117.95), and Return Per Naira Invested RNI (N0.71) for the deep litter system. This shows that both systems were profitable in the study area. The Return per Naira Invested (RNI) showed that for every N1 invested a return of 91 kobo and 71 kobo accrued to the farmer for battery cage and deep litter systems respectively. Only three variables in the regression model were found to be statistically significant (P<0.05), these were feed cost, electricity, and purchase cost of day old chick for both the battery cage and deep litter systems. Feed cost was the major determinants of revenue accruing to the farmers.
CONCLUSION
From the analysis, broiler farming is profitable for both the battery cage and deep litter system of production. However, the battery cage system of production require high degree of skill and knowledge in management as well as high capital investment in both fixed and variable inputs which most of the farmers are lacking.
The battery cage system offer relatively higher return to investment though it is most expensive to set up. We can say that the increase in the level of poultry meat supply in the study area, as well as the income position of the farmers and their standard of living lies in the improvement of the production system adopted.
RECOMMENDATIONS
Based on the findings of the study and the problems enumerated by the farmers, the following recommendations are considered appropriate for the possible improvement of poultry production in this study area:
- Farmers in the study area should practice the battery cage system, since it has higher Net farm income.
- The farmers should constitute themselves into self help group to attract loan from corporate financial institutions.
- Farmers are advised to compound their own feed as this will help to reduce the cost feeds which account for over 70% of the total cost of raising broilers from day old chick to point of sale.
- Lastly the electricity service provider should charged customer according to their consumption instead of the estimated billing system which is currently in place in the study area.
All these recommendations if adequately implemented will help to boost poultry production in the study area as well as increase income position of the poultry farmers. Subsidiary industries such as those producing poultry houses, equipment etc. will be viable when poultry are kept intensively.
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