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1. Introduction Poultry meat is an important source of high quality proteins, minerals and vitamins to balance the human diet. Specially developed varieties of chicken (broilers) are now available with the traits of quick growth and high feed conversion efficiency. Depending on the farm size, broiler farming can be a main source of family income or can provide subsidiary income and gainful employment to farmers throughout the year. Poultry manure is of high fertilizer value which can be used for increasing yield of all crops. The advantages of broiler farming are
Initial investment is a little lower than layer farming. Rearing period is 5-6 weeks only More number of flocks can be taken in the same shed. Broilers have high feed conversion efficiency i.e. the amount of feed required for unit body weight gain is lower in comparison to other livestock. Faster return from the investment Demand for poultry meat is more compared to sheep/goat meat
2. Scope for broiler farming and its national importance India has made considerable progress in broiler production in the last three decades. The broiler production has sky rocketed at an annual growth rate of about 10% and stands at about 2.3 million metric tons of chicken meat (FAO 2005). The population of broiler poultry as per 2004-05 census is 199.73 million. Today India is the fifth largest producer of broiler meat in the world. Despite this achievement the annual per capita consumption in India is only 1600 grams of poultry meat as against the world average of 5.9 kg of meat.
providing veterinary services and wholesale marketing of birds. provides technical guidance and takes entire production after 5-6 weeks. high quality chicks. chick selling. right from raising of grandparent and parent flocks. the farmer may be at a disadvantage if the number of batches supplied in the year by the integrator is less. Andhra Pradesh in the years 2001 & 2002 and after that. it gained inroads into West Bengal and Gujarat. The items of finance would include construction of broiler sheds and purchase . feed selling. production of day old chicks for rearing. Farmer is benefiting from the lesser investment and production cost and also higher productivity which is achieved as a result of integration. Integrators will take care of all aspects of production. Under contract farming.Recommended per capita consumption of chicken meat by National Institute of Nutrition is 11 Kg. This has eliminated the middlemen. poultry farmers invest only for poultry sheds / equipment on their existing land. consumer and the integration company themselves. Financial assistance available from Banks/NABARD for broiler farming For poultry farming schemes with very large outlays detailed project reports are required to be prepared. 4. 3. The Integrator supplies chicks. However. feed. transportation have become cost centres for the integrators who work as a single entity and distribute the benefits among the farmer. medicines. medicine supply. technically and professionally competent guidance are available to the farmers. The management practices have improved and disease and mortality incidences are reduced to a great extent. In the early nineties. Integration in Broiler Farming: There is a growing trend of integration in broiler farming. Between 1995 and 2000. Broiler farming has been given considerable importance in the national policy and has a good scope for further development in the years to come. manufacturing and supply of concentrate feed. Many institutions are providing training to entrepreneurs. hatching. Increasing assistance from the Central/ State governments and poultry corporations is being given to create infrastructure facilities so that new entrepreneurs are attracted to take up this business. it spread to Karnataka. vaccines and medicines. contract farming for broilers was introduced and in 1995 it spread all over Tamilnadu. Owing to the considerable growth in broiler industry. The spread is due to built in strengths in integration system. The contract farmers are paid growing charges as per agreed rates. Under integration all the previous profit centres of the broiler industry viz. It gathered momentum and spread its wings to Maharashtra. equipment.
transport vehicles. 7. It will also include data on proposed capacity of the farm. are also examined. veterinary aid. local hatcheries.e. 5. security aspects. before starting a broiler farm. the scheme is sanctioned by the bank.2 The scheme should include information on land. As broilers have to be sold within 35 to 40 days of age. training facilities. Cost of land is usually not considered for loan.e. Technical feasibility . Poultry Corporation or private commercial broiler hatcheries. 5. total cost of the project. veterinary aid. purchase of equipment and machinery. margin money requirements etc. against the creation of specific assets. regular and constant demand for broiler meat and nearness of the farm to the market should be ensured. Poultry Corporations. A field visit to scheme area is undertaken for conducting techno economic feasibility study for appraisal of the scheme. Sanction of Bank loan and its disbursement After ensuring technical feasibility and financial viability. and training/experience of the beneficiary B. Financial viability . repayment of principal loan amount and interest Other documents such as loan application form.. sale of broilers. A format developed for project report preparation for a commercial broiler farm is given in Annexure -I 6. they should also visit the progressive broiler farmers in the area and discuss the profitability of farming. Cost towards land development.of equipment. essential servant’s quarters. Appraisal of the project The bank officers can also assist in preparation of the scheme or filling in the prescribed application form. A. A good practical training and experience on a broiler farm will be highly desirable. water and electricity.1 A scheme can be prepared by the promoter after consulting local technical persons of State Veterinary / Animal Husbandry department. Scheme formulation for bank loan 5. fencing. estimated annual expenditure. cost of one day old chicks. income and profit and the repayment of loan and interest. broiler dressing. recurring cost on purchase of . The scheme so formulated should be submitted to the nearest branch of the bank. manure and other miscellaneous items. feed. feed. margin money to be provided by beneficiary and requirement of bank loan. processing and cold storage facilities can also be considered for providing loan.this would briefly include: (a) Unit cost and loan requirement (b) Input cost for chicks. medicine and labour cost for the first cycle. water and electricity facility. (d) Calculation of annual gross surplus (income-expenditure) (e) Cash flow analysis (f) Repayment schedule i. godowns. construction of sheds.this would briefly include: (a) Suitability of climate and potentiality of the area (b) Technical norms including schedule for replacement of flocks (c) Infrastructure and other facilities available for supply of inputs. marketing etc. If possible. The bank will then examine the scheme for technical feasibility and economic viability. The loan is disbursed in kind in 2 or 3 stages. expertise of entrepreneurs and the type of assistance available from State government. marketing aspects. labour and other overheads (c) Output cost i.
chicks.Commercial Broiler Farm 1.General: 8. 8.1 Outlay : Outlay of the project depends on the local conditions. we have assumed rate of interest as 12% p. Prevailing market prices may be considered to arrive at the outlay.5 Repayment of loan : The loan repayment is determined. . feeds. 8. 8. The end use of the loan is verified and constant follow up is done by the bank. equipment) may be insured.4 Security: Security will be as per NABARD / RBI guidelines issued from time to time. 8.3 Interest Rate: Banks are free to decide the interest rates within overall RBI guidelines. Annexure I Format for preparation of Project report Poultry .6 Insurance : The birds and other assets (poultry shed.2 Margin Money : Margin depends on the category of the borrowers and range from 5 to 25%. on the basis of gross surplus generated in the scheme.a. 8. unit size and the components included in the project. fencing. Lending terms . Wherever necessary Risk/Mortality fund may be considered in lieu of poultry insurance. medicines. for working out financial viability and bankability of model project. gates etc. GENERAL i) Nature and objectives of the proposed scheme ii) Details of proposed investments iii) Specification of the project area iv) Name of the financing bank branch v) Status of beneficiary: (Individual)/Partnership/ Company/Corporation/ Co-operative Society/Others vi) Borrowers profile (a) Capability (b) Experience (c) Financial soundness (d) Technical/Other special qualifications (e) Technical/Managerial Staff and adequacy thereof 2. etc. TECHNICAL ASPECTS: a) Location. Usually the repayment period of loan for broiler farming is 6 to 8 years. However. 8. Land and Land Development: i) Location details of the project ii) Total area of land and it's cost iii) Site map iv) Particulars of land development.
Store room . of birds to be purchased iii) Source of purchase iv) Cost of birds (Rs. per bird) v) Vaccination of purchased birds vi) Proposed programme of replacement f) Production parameters: i) Average body weight (kg.) ii) Feed efficiency (kg./bird) e) Birds: i) Proposed strain ii) No.Broiler Sheds .Finisher iii) If manufactured on farm a) Capacity of feed grinder and mixer b) Source of raw materials .Quarters for staff .Starter ./kg) .Deep Litter/Slat/Environment controlled) ii) Area required (sft.Others c) Equipment/Plant and machinery: (i) Feeders (ii) Waterers (iii) Generator (iv) Feed grinder and mixer (v) Debeaker (vi) Vaccinator (vii) Fridge/Deep Freezer (viii) Dressing equipment if necessary (ix) Truck/van/jeep (Price quotations for the above equipment) d) Housing: i) Type of housing .Dressing room .Office room .b) Civil Structures: Detailed cost estimates along with measurements of various civil structures . of feed/ kg body weight gain) iii) Mortality (%) g) Flock Projection Chart: h) Feeding: i) Source of availability .Purchased or own feed manufacturing ii) If purchased a) Place of purchase b) Brand c) Cost (Rs.
) vii) Expenditure per bird per cycle (Rs.Finisher iv) Requirement (kg/bird) .c) Feed formula d) Cost of production (Rs./Q) ii) Empty gunny bags . per kg live weight or live bird) vi) Periodicity of payment m) Marketing of other products i) Manure .) iv) Availability of labour and other staff v) Type of facilities available vi) If own arrangements are made a) Employed a veterinary doctor/stock man /consultant b) Periodicity of visit c) Amount paid (Rs.Starter ./bird.) j) Electricity i) Source SEB / Other ii) Approval from electricity board iii) Connected load iv) Problems of power failure v) Arrangements for generator k) Water i) Source ii) Quality of water iii) Availability of sufficient quantity for drinking and cleaning iv) If investment has to be made. if any .Starter .(Rs.Finisher i) Veterinary aid i) Source ii) Location iii) Distance (km. design and cost l) Marketing of broilers i) Source of sale ii) Place of disposal iii) Distance (km) iv) Basis of payment (number or weight) v) Price realised .Number and cost/bag n) Beneficiary's experience o) Comments on technical feasibility p) Government restrictions./kg) . type of structure. price per unit (Rs.Qty.
3.) Total Capital Costs(A) Recurring Costs Total Recurring Costs (B) Total Project Cost (A+B) ii) Down payment/margin/subsidy (Indicate source & extent of subsidy) iii) Financial viability ( comment on the cash flow projection on a farm model / unit and enclose the same ) Particulars : a) Internal Rate of Return (IRR): b) Benefit Cost Ratio (BCR) : c) Net Present Worth (NPW) : iv) Financial position of the borrowers (to be furnished in case of corporate bodies/partnership firms) a) Profitability ratio i) Gross Profit ratio ii) Net Profit ratio b) Debt equity ratio c)Whether Income tax & other tax obligations are paid upto date d) Whether audit is upto date (enclose copies of audited financial statements for the last three years) v) Lending Terms : a) Rate of interest b) Grace period c) Repayment period d) Nature of Security e) Availability of Government guarantee wherever necessary 4. No. Item Capital Costs Physical Unit and Specification Cost (Rs. Periodicity. FINANCIAL ASPECTS : i) Project Cost Sr. INFRASTRUCTURE FACILITIES: a) Availability of technical staff with bank/implementing authority for monitoring b) Details of i) technical guidance ii) training facilities iii) Government support/ extension support c) Tie-up arrangements with marketing agencies for loan recovery : d) Insurance : Type of policy. Rate of premium .
per bird) 1000 1000 1050 1020 1000 1 120 16 20 3.ft) Cost of construction of shed (Rs. labour and misc. Techno Economic parameters Number of birds Batch strength Birds purchased per batch Birds considered for recurring expenditure Birds considered for selling Floor space per bird ( s.50 0. miscellaneous charges Insurance of birds Insurance of sheds and equipment Total Grand Total (A+B) or say Margin (15%) Bank Loan 120000 16000 136000 21000 57222 8670 525 687 88104 224104 224000 33600 190400 B.50 . per sft) Cost of equipment (Rs. charges Insurance per bird (Rs. per kg) Medicines. labour. per bird) Cost of day old chick (Rs.3 17 8.Annexure II ECONOMICS OF A COMMERCIAL BROILER UNIT A. Project Cost Capital Cost Construction of shed Cost of equipment Total Recurring Expenditure Cost of day old chicks Cost of feed Medicines. vaccines. per bird) Feed requirement per bird ( Kg) Cost of feed (average price Rs.
57800 60690 60690 charges Insurance of birds 3675 3675 3675 Insurance of sheds and 687 687 687 equipment Total 590642 612606 612606 Surplus 79454* 66036 66036 * Capitalised recurring expenditure excluded while arriving at the surplus 8 D. BCR & IRR Years Capital Cost 1 136000 2-7 8 .a) Rearing period Cleaning period of shed Flock Chart 1 Years No. of batches Rearing weeks Batches sold 7 40 6 7 42 7 2-8 5.6 60 0. Calculation of NPV.1. per bag) Margin (%) Interest on bank loan (% p.05 1. per bird) Sale price of gunny bags (Rs. per Rs. Income and Expenditure Statement Years 1 2-7 Income Sale of birds 576000 672000 672000 Sale of manure 3000 3500 3500 Sale of gunny bags 2992 3142 3142 Total 581992 678642 678642 Expenditure Cost of chicks 147000 147000 147000 Cost of feed 381480 400554 400554 Cost of medicines & misc. per kg) Value of manure per bird sold (Rs.50 10 15 12 6 weeks 2 weeks C.000/-) Live weight of bird (Kg per bird) Sale price (Rs.Insurance of sheds and equipment (Rs.
05 43.77% 612606 612606 678642 678642 66036 612606 612606 678642 72000 750642 138036 E. Repayment Schedule Year 1 2 3 4 5 6 7 Loan 190400 165576 145823 123700 98922 71171 40090 Gross surplus 79454 66036 66036 66036 66036 66036 66036 Interest Principal 22848 24824 19869 19753 17499 22123 14844 24778 11871 27751 8541 31081 4811 40090 Total repayment 47672 39622 39622 39622 39622 39622 44901 Net surplus 31782 26414 26414 26414 26414 26414 21135 .Recurring Cost Total Costs Income Residual value of shed Total Benefit Net Benefit Disc cost at 15% DF Disc benefit at 15% DF NPW at 15% DF BC Ratio IRR 590642 726642 581992 581992 -144650 2848122 2984778 136656 1.
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