Costing and pricing of poultry products

Industry Overview According to studies and researches, the cost of starting a commercial poultry farm in the United States of America or any other place in the world is capital intensive. However, the expenses would reduce especially as the first items and equipment needed to start are a one-time expenses only. The only time the start-up capital is low is when the entrepreneur is either starting off on a small scale or is going into the provision of niche poultry farm services. Also, another reason for low or high start-up capital might be dependent on the kind of poultry farming — free range, deep litter system, semi litter system, and battery caging system — the entrepreneur is planning on going into.

Costing and pricing of poultry products

Costing and pricing of poultry products

Production Economics The agricultural subsector of animal production is part of a complex interdependent farming system. Analysis of livestock production cannot be based solely on input and output, but must also take into consideration other farming activities.

The interaction between animal production and other subsectors can be complementary, as in the use of manure; or competitive, as in the allocation of land to crops or livestock grazing. The farming system as a whole, and animal production in particular, is influenced by external factors including government policy on rural development, livestock development programmes and marketingwhich must be considered in any analysis or evaluation.

It is a decision-making and land-use unit, comprising the farming household and the crop and livestock systems, which transforms land, labour, management and capital into products that can be consumed or sold.

In the case of family poultry, the products are poultry meat and eggs, with manure as a by-product. The harvesting of family poultry for home consumption and sale can be considered as the management of a standing resource for economic yield.

In this respect, the economic principles applying to the management of fauna, parklands, fisheries, wood and timber forests and rangelands are more appropriate than the economic concepts more commonly applied to the labour and capital-dependent livestock production and other commercial farming industries.

The inputs may be external Non-Factor costs or internal Factor costs. Internal input is under the control of the farming household, and includes land, labour, management and capital.

Another way to categorize the costs is to distinguish Variable Costs from Fixed Costs. Variable costs rise and fall with the size of the output and the level of the operation. Variable costs for items such as feed, vaccine and casual labour can be controlled to some extent and are not incurred when there is no production.

Fixed costs for items such as taxes, insurance, interest, and depreciation on buildings and equipmentare incurred whether or not there is any output. The Opportunity Cost principle is applied in farm cost accounting.

Poultry produce eggs, meat and manure. This will result in the Total Net Costs. For the cost-price per unit of production, the Total Net Costs must be divided by the total number of units of production. The cost-price calculation model splits production costs into two categories: Paid Costs and Calculated Costs.

Paid costs involve actual payment in cash or kind for inputs or services used.

How Much Does It Cost to Start a Poultry Farming Business?

Calculated costs are determined using mathematical formulae, and include the following: Calculated Costs include Opportunity Costs as related to the national economy: These form a part of the socio-economic reality for the smallholder, and influence the Opportunity Cost of labour reduced by high unemployment and of capital which tends to move towards zero when the rate of currency devaluation is higher than the interest rate.

By making use of locally available and renewable materials for poultry housing and equipment, family poultry producers minimize the introduction of external capital into their enterprise.

Large-scale poultry production cannot really be compared with smallholder family poultry, because smallholders often face such constraints as the absence of organized marketing systems and the lack of price rewards for produce quality and uniformity.

Therefore, the cost-price calculation for large-scale poultry production and also that for free-range commercial poultry production may not be applicable to smallholder family poultry systems without modifications.

Elson showed that for layers, production costs per dozen eggs produced increased with space allowance stock density per hen.

The production cost for birds housed in laying cages at this density is used as a baseline. The percent increases in cost over this baseline each with their associated management system are: A comparison of the EC cage minimum as a base, with perchery and free-range alternatives, is shown in Table 8.Cost Accounting & Farm Business | Accounting.

Similarly, in the livestock production calculation of cost for different livestock or poultry products and the working of cost per unit is necessary. The very survival of the farm business depends on the science of cost accounting. In fact, costing is an investment which is done where in the.

At the same time, FSIS also approved the use of BOC Food Safety’s ozone wash system using aqueous ozone on RTE meat and poultry products for the control of Listeria. In , FDA approved ozone in both gaseous and liquid phases as an antimicrobial to be applied directly to food.

OPERATIONAL RESULT THROUGH VARIABLE COSTING: AGRICULTURAL AND POULTRY PRODUCTION Luis Gustavo Castanheira Operational Result through Variable Costing 57 Control Costs To attribute costs to products and/or services, costing methods are used, some of which.

Costing and pricing of poultry products

Costing and Pricing of Poultry Products in Bangladesh Essay Therefore, proper costing and pricing can determine the effectiveness and success of poultry production and business and its contribution in the economic development of the country.

Costing is the classifying. Joint Product and By-Product Costing. LEARNING OBJECTIVES. further processing of joint products, and pricing jointly produced products. The small pieces of granite resulting from the cutting process are crushed and sold to farm-supply outlets as poultry grit.

A Proposal for M. Phil Research Study ‘Costing and Pricing of Poultry products in Bangladesh – An Evaluation’ 1. Introduction: Agriculture plays an important role in economic development of Bangladesh. Poultry is one of the important subsectors of agriculture.

Poultry is domesticated birds kept by humans for the purpose of producing eggs.

Small-scale poultry production