Profitability and Cost Analysis for Contract Broiler Production in Turkey.

Simple Summary: This study aims to determine the income level of contracted broiler breeders in terms of earnings and to calculate the profitability, cost, and return of contracted production. In broiler production, the contracted production model between the breeder and the integrated broiler business that supplies the product to the market is applied in Turkey as well as in the world. Broiler production is completed in 5–7 weeks in the normal process. This process may vary depending on slaughter weight, market conditions, carcass broiler weight demands of consumers, feed prices, broiler sales price, and operating conditions. However, in some periods, integrated broiler enterprises make the broiler slaughter earlier in order not to experience disruptions in product supply in the supply chain. In such cases, to determine whether broiler breeders suffer from income loss, breeding parameters were calculated as cost and net income gain in the study. The results show that the entrepreneurs generated a net income of $9.197 per m2 and $0.541 per broiler during the rearing period from broiler breeding. Despite the low earnings in contracted broiler breeding, it is continued because it allows the on-site evaluation of the workforce of family businesses engaged in breeding. Integrated broiler enterprises can procure products regularly throughout the year through contracted production. This study uses the data obtained from 63 broiler farms engaged in contract farming in Akhisar, Turkey. The average feed conversion ratio in the broiler farms is 1.75, the average live weight 2.25 kg, and the mean market age 38.9 days. The feed conversion rate and the income generated are highly correlated (r = −0.76). The production index is 313.4. According to this production index value, 47.6% of the enterprises are below the average production index. It is highest when the marketing age is greater than 38 days, less than and equal to 40. In other words, it is the optimum market age range where carcass yield is at maximum. The average mortality rate is 4.68%. In 52.4% of the enterprises, the mortality rate is above 5%. There is a low level of correlation between the mortality rate and income (r = −0.26). In broiler farming, mortality rate, and feed conversion ratio are factors that directly affect the success and income of the breeder. In broiler farming, the heating cost has the largest share of the total cost, followed by the litter cost. They are followed by labor, electricity, and pesticide costs. Variable costs account for three-quarters of the total operating costs. The farms have a mean gross value of production of $23.797 per m2 and $1.400 per broiler in a breeding period. The profit margin is 0.572 $/kg per broiler. The mean enterprise net income in the breeding period is $9.197 per m2 and $0.541 per broiler. These findings suggest that broiler farming is a profitable venture. [ABSTRACT FROM AUTHOR]