Pradan Community Poultry Approach


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A pro-poor poultry contract farming by Pradan India

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Pradan Community Poultry Approach

  1. 1. Community Broiler Farming : Making Poor Participate in Poultry Growth
  2. 2. Presentation Outline <ul><li>Context : Opportunity for Escaping Poverty </li></ul><ul><ul><li>Poultry Sector : Growth & Opportunities </li></ul></ul><ul><ul><li>Business Concept </li></ul></ul><ul><li>Small-holder Poultry Model : De-risking Family Poultry </li></ul><ul><ul><li>Primary Aggregation as Cooperative </li></ul></ul><ul><ul><li>Co-creating Growth and Success – the institutional model </li></ul></ul><ul><li>PRADAN’s Experience and Plans </li></ul>
  3. 3. Business Concept <ul><li>Business Opportunity </li></ul><ul><ul><li>Table bird market </li></ul></ul><ul><ul><ul><li>Large domestic mkt - 2.1 m tonnes live weight consumed now, YoY growth of 12 %, fourth largest worldwide, competitive cf. USA, Brazil, high income elasticity – meat of first choice </li></ul></ul></ul><ul><ul><ul><li>Labour efficiency key to Productivity – space for poor </li></ul></ul></ul><ul><li>Key constraints to participation of Poor </li></ul><ul><ul><li>Entry barriers - technology, scale of operations, investments </li></ul></ul><ul><ul><li>Priorities </li></ul></ul><ul><ul><ul><li>misplaced in govt. sector - scavenging, niche-game birds </li></ul></ul></ul><ul><ul><ul><li>peg onto urban consumption focus on urban/peri-urban natural – large farm size </li></ul></ul></ul>
  4. 4. Poultry - the big Opportunity How Poor can Cash-in ? <ul><li>By taking up small-holder poultry which is technologically similar to industrial poultry </li></ul><ul><ul><li>not the traditional scavenging poultry </li></ul></ul><ul><li>And </li></ul><ul><ul><li>by working to augment the advantages of smaller decentralised units like better efficiency, faster and better disease control </li></ul></ul><ul><ul><li>by working to reduce the disadvantages of small units in procurement of inputs and sale of birds, bridging the technology and scale imperatives </li></ul></ul>
  5. 5. Continue..... <ul><li>Production Technology Advantages for Poor </li></ul><ul><ul><li>no big difference in big & small farmer </li></ul></ul><ul><ul><li>adaptable to scaling down </li></ul></ul><ul><ul><li>significant labour component </li></ul></ul><ul><li>Intervention : the institutional model </li></ul><ul><ul><li>Right sizing the unit : risk, return, investment </li></ul></ul><ul><ul><li>Technology : adapting the best for high performance </li></ul></ul><ul><ul><li>Market : focus on under-served </li></ul></ul><ul><ul><li>Faith in Abilities of Poor </li></ul></ul>
  6. 6. Community Owned Rural Poultry Enterprise Model <ul><li>Insulate the families from price fluctuations and supply uncertainties of the market, </li></ul><ul><li>Strengthening the production system through improved market access , better capital management , and high quality production services and technical handholding. </li></ul><ul><li>The community poultry model focuses on </li></ul><ul><li>Tribal and Dalit women’s induction in the activity </li></ul><ul><li>Organizing them into collectives </li></ul><ul><li>Creating system and processes to attain industry-competitive production and scale efficiencies. </li></ul>
  7. 7. Design Features <ul><li>Rapid Assessment in a New Area </li></ul><ul><li>Socio-technical Feasibility </li></ul><ul><li>Livelihood Portfolio, Road+Water Access , </li></ul><ul><li>Prevailing wage rate & opportunity – RPD </li></ul><ul><li>Market-financial Feasibility </li></ul><ul><li>Market - Deficit & Latent, Competition, Input Supply, Margin per bird/kg – Unit size </li></ul>
  8. 8. ……… Design Features <ul><li>Selecting the ‘right’ Farmers </li></ul><ul><ul><li>proxy indicators designed on empirical evidence </li></ul></ul><ul><ul><li>Self-selection during training </li></ul></ul><ul><li>Training & Skilling-up </li></ul><ul><ul><li>No-stipend experiential training </li></ul></ul><ul><ul><li>Focus on logic and nuances in husbandry </li></ul></ul><ul><li>Infrastructure </li></ul><ul><ul><li>Accessible and individual ownership </li></ul></ul><ul><ul><li>Decentralised all-in-all out sheds breaking horizontal spread </li></ul></ul>
  9. 9. …… .. Design Features <ul><li>Production & Technical Support </li></ul><ul><ul><li>Clusters of 25-30 producers </li></ul></ul><ul><ul><li>Trained para-vet in each cluster chosen from producers </li></ul></ul><ul><ul><li>Village store in cluster for door step delivery of inputs </li></ul></ul><ul><ul><li>Para-vet (Supervisor) paid on output </li></ul></ul><ul><ul><li>Centralized Production Scheduling, DOC Placement, Variance Monitoring, Ready Bird Marketing System </li></ul></ul><ul><ul><li>Staggered production schedule -optimizes w/k </li></ul></ul><ul><ul><li>Multi-layer disinfection and bio-security measures </li></ul></ul><ul><ul><li>5-7 batches in a year,effective working : 3-4 hr/day </li></ul></ul>
  10. 10. Design Features continue….. <ul><li>Risk Mitigation </li></ul><ul><li>Delinking Production & Enterprise Efficiency </li></ul><ul><li>Mechanism to absorb effect of price fluctuations </li></ul><ul><li>Discriminate between good & bad production performance </li></ul>
  11. 11. Ensuring Industry Competitive Production Costs : Grower Payment linked to Efficiency <ul><li>Critical Production Parameters in Broiler Farming: </li></ul><ul><li>Feed Conversion Ratio (FCR) </li></ul><ul><li>Avg. Body Wt (kg) </li></ul><ul><li>Livability (%) </li></ul><ul><li>No of Days </li></ul><ul><li>Livability(%) X Avg Body Wt(Kg) </li></ul><ul><li>Efficiency Index=-------------------------------------------- X100 </li></ul><ul><li>F.C.R X No of Days </li></ul><ul><li>Called as “EI system” </li></ul>
  12. 12. ………… Design Features <ul><li>Marketing </li></ul><ul><li>Single window centralized marketing </li></ul><ul><li>Producer owned delivery system </li></ul><ul><li>Warehouses in big markets </li></ul><ul><li>Establishing Retail network </li></ul><ul><li>Target 40-50 % market share within 200 kms. radius </li></ul>
  13. 13. ……… ..Design Features <ul><li>Finance </li></ul><ul><ul><li>Capital Investments </li></ul></ul><ul><ul><li>- Targeted at self-employment </li></ul></ul><ul><ul><li>Working Capital </li></ul></ul><ul><ul><li>- Seed fund to collective and further from bank </li></ul></ul><ul><li>Governance </li></ul><ul><ul><li>Mutually Aided Cooperative </li></ul></ul><ul><ul><li>Professional Management </li></ul></ul><ul><ul><li>Governing Board with outside membership </li></ul></ul>
  14. 14. Cooperative (300-400 producers) Central accounts, input supply, marketing Wholesalers Supervisors (20-30 producers) Inputs distbn, production support Small Producers (400-700 birds) Family Level Income Rs.75-100/day for 200 days p.a. Rs.15,000-20,000 p.a. Small Holder Broiler Farming Model Retail outlets Producer Collective Turnover : 4-5 crore Producer Margin : 45-50 Lakh <ul><li>Unit Cost : Rs.52500 per family </li></ul><ul><ul><li>Rs.30000 for capital asset + Rs.15000 for w/k </li></ul></ul><ul><ul><li>Rs.2000 for capacity building </li></ul></ul><ul><ul><li>Rs.5500 for institution building (incldg. Infra + external support) </li></ul></ul>
  15. 15. Kesla Poultry Cooperative 1 st small-holder broiler producers cooperative <ul><li>Background </li></ul><ul><li>PRADAN started broiler farming in 1993 </li></ul><ul><li>Activity organized on cooperative lines in 1997 and registered in 2001 </li></ul><ul><li>Achievements </li></ul><ul><li>618 tribal/dalit women broiler farmers – 50 % promoted under mainstream poverty alleviation programs </li></ul><ul><li>Cooperative is the commercial largest farm-production house in Madhya Pradesh </li></ul><ul><li>FY 2008-09 - Turnover 104 million </li></ul><ul><ul><li>Producer payments Rs.14.0 million </li></ul></ul><ul><li>FY 2009-10 – Turnover 137.63 million turnover </li></ul><ul><ul><li>Producer payments Rs.15.5 million </li></ul></ul><ul><li>Growth Nucleus : Kesla tribal belt monthly DOC placement increased from 8,000 in 1993 to 4.0 lakh in 2010 is now counted as one of important broiler centres of Central India </li></ul>
  16. 16. Operations Overview <ul><li>Largest Broiler Production Houses in Jharkhand, Madhya Pradesh </li></ul><ul><ul><li>Spawned sectoral growth in its operational area </li></ul></ul><ul><li>Demonstrated relevance as income generation programme for resource poor (landless) families in the Central Indian Poverty Region </li></ul><ul><li>Demonstrated that small-holder broiler can succeed & thrive </li></ul><ul><ul><li>one of larger integrations in India </li></ul></ul><ul><ul><li>entirely owned by tribal & dalit women </li></ul></ul><ul><li>Recognised for better-than-industry productivity </li></ul>Mkt Leaders Small
  17. 17. Scalability & Sustainability <ul><li>Experience : demonstrated scalability & sustainability in varied setting </li></ul><ul><ul><li>setting new coops, tapping markets, productivity, success in presence of integrated farms </li></ul></ul><ul><li>Key Drivers : (i) better productivity & cost of production ; (ii) effective tapping of local small dispersed markets </li></ul><ul><li>Potential Size & Growth of Market </li></ul><ul><li>Key constraints : supplies - vertical integration investments </li></ul>Year 1997 2001 2003 2007 2010 Producers 150 220 400 3200 7000 Cooperative 0 1 2 12 19 Federation 0 0 0 1 2 Industry Features slump   slump, integrators bird flu, disappearing small farm vertical coordinated
  18. 18. Social Impact <ul><li>Target Clients : Women from tribal & dalit families, average household income of Rs. 20,000 p.a., deficit at household Rs. 3,000-5,000 p.a. </li></ul><ul><li>Business Intervention : </li></ul><ul><ul><li>75 % increase in annual income, family becomes net surplus and starts investing in land, education, health etc. </li></ul></ul><ul><ul><li>Helps women stay back – restoring family/social life – particularly children and their education </li></ul></ul><ul><ul><li>Improved farm production – enhancing food sufficiency </li></ul></ul>
  19. 19. Growth Projections <ul><li>Next 3-5 years : </li></ul><ul><li>Break into top 10 broilers producers in India – 5 fold growth in 5 years </li></ul><ul><li>Generate income in hands of poor families to the tune of Rs. 20 crore </li></ul><ul><ul><li>Consolidate and strengthen presence in the existing areas </li></ul></ul><ul><ul><li>Establish an institutional architecture (national trust, private businesses), systems & processes which will lead growth </li></ul></ul><ul><ul><li>Expand to new areas – Bihar, Assam, West Bengal </li></ul></ul>216 162 120 78 Margin (mRs.) 1800 1350 1000 650 Turnover(mRs.) 12000 9000 7000 5300 Producers 2011-2012 2010-11 2009-10 2008-09   amount in m INR
  20. 20. Community Poultry : Institutional Model Co-operative Society Individual Members of the Co-operative Society Co-operative Society Co-operative Society State Level Federation of Member Co-operatives - Governance Support - Statutory compliances - Quality Feed - Technical Support - Management Support National Small-holder Poultry Development Trust BGM Biologicals Pvt. Ltd. P R A D A N - Organization Development - Business Support - Origination &handholding - Mobilise investments
  21. 21. In next 10 years “50,000 farmers of an average unit size of 800 sq ft produce annually 200 million live birds valued at Rs. 15 billion (Rs.1500 crore) generating Rs.1 billion (Rs.100 Crore) in the hands of the farmers and Rs.200 million (Rs.20 crore) additional income in the hand of community workers, support and professional staff. These 50,000 farmers are organized in 100 primary producer organizations making it the largest family poultry initiative in the world and in top five broiler producers in India with a gross turnover including of its associates being Rs. 2000 crore” Community Poultry: Mission & Scope
  22. 22. <ul><li>THANKS </li></ul>