Financial Feasibility of Broiler Production in Case of Non Contract and Contract Farms

Abstract

An attempt was made to explore the financial feasibility of broiler poultry production in Chikkaballapur district of Karnataka. The objective of the study was to work out cost and returns in broiler production and to assess the financial feasibility of broiler production. The data was collected from 90 broiler farms consists of both non contract and contract farms. In the study area, the average fixed capital investment made per bird was ` 213.74 and ` 151.51 in non contract and contract farms respectively. Cost of production and net returns per bird were ` 123.16 and ` 18.44 respectively in case of non contract farms against ` 11.02 and ` 4.62 in contract farms. In the study area, number of birds to be raised annually to cover the cost of production in non contract and contract farms was found to be 13118 and 26692. The feasibility study shows that, the investment in non contract broiler farms was economically feasible with NPV of ` 2892260, BC ratio of 1.14 and IRR 49.53 per cent indicating more returns per rupee invested. Conversely, investment in contract broiler farms was just marginally feasible with NPV of ` 28928, BC Ratio of 1.41 and IRR 16.39 percent.