The price of broiler chickens has been low, and thousands of independent broiler farmers have sold their chickens at a loss. However, contract growers of Kazi Farms are better off, as they can get an attractive growing fee even if the company sells chickens at a low price.
Many farmers in Mymensingh grow chickens independently, purchasing chicks and feed from local dealers. The independent farmers make profit when the broiler price is high, but lately they have made losses as the broiler price has been low.
During a recent field visit, a number of farmers said that it is difficult for them to keep producing when the market price of broilers is low. On the other hand, many small farmers have become contract farmers of poultry companies. Contract farmers of Kazi Farms say that they are paid a growing fee which depends on their productivity, not on the market price of broilers. If their productivity is high, they can get an attractive growing fee even when the price of broilers is low. The company might lose money when the price of broilers is low, but the contract farmers do not lose money.
Afroza Khatun, 32, is a university graduate and female poultry farmer of Doshmail Bazar in Fulbaria upazila. She used to be an independent farmer, but became a contract farmer of Kazi Farms over two years ago. “We made losses most of the time and we survived on my husband’s income. Now, I make at least Tk15,000 from a batch of 800 birds,” she said.
Some of the farmers in this part of the country said they might have to stop poultry farming due to repeated losses. Independent farmer Mohammad Selim, 35, pointed out that in his 14-year experience in this business, he made losses most of the time. “Recently I had to sell chickens for Tk118 per kg whereas our production cost is Tk145 per kg. We will not be able to survive if this situation continues,” he said.
Sabbir Hossain, 21, a student and small farmer in Dolia in Bhaluka upazila, observed that many conscious farmers are choosing to sign contracts with companies. “In times of disasters and low prices, we don’t see a better way than joining contract farming, as the companies are doing business with win-win formula,” he added.
Asked about fair price of their produce, the farmers said their production cost is at least Tk 145 per kg, and that the retail price should be high enough for farmers and traders to make profit.
Hafizur Rahman, a senior manager at Kazi Farms, said they have a formula which rewards growers for efficient FCR (feed conversion ratio). “When the price of broilers is low, our contract growers are grateful to us. Independent farmers are now selling chicken at a loss, but our contract growers can earn an attractive growing fee even when the broiler price is low. We have trained them to maintain bio-security, so that antibiotics will not be needed. Independent farmers use antibiotics frequently, which increases their cost,” he said.
Kazi Zahin Hasan, Director of Kazi Farms, said: “Independent farmers buy chicks, feed and medicines from dealers. Dealers encourage farmers to use unnecessary antibiotics, because they want to sell more antibiotics. This increases the farmer’s cost. Our contract farmers get feed, chicks, and medicines directly from us. There is no dealer in the middle selling unnecessary antibiotics. That’s why our contract farmers can produce at a lower cost.”