Integration in layer production

2. 
 The poultry sector in India has undergone a paradigm
shift in structure and operation.
 Till Late 80’s Poultry activities were Dormant. In the
early 90’s Poultry Industry came into the focus
 The major development in Indian poultry production is
the spread of integration, particularly in southern and
western parts.
 The contract farming systems and the vertical
integration have played a major role in this spectacular
growth
Introduction

3. 
 Association, coordination, amalgamation of
companies engaged in various stages of production
of particular product so that, there will be a smooth
flow of inputs and outputs from one unit to other,
leading to overall reduction in the cost of production
of the final product.
 Its an association between the integrator and
producer.
Integration:

4. 
 a. Integrator
 b. Producer / farmer
Components of integration

5. 
 Integrator is owner of breeding farms, parent stock,
grower, hatchery, feed mill, rendering plant,
processing plant and pay commission to others for
the services rendered by them.
 Supply of all inputs
 Chicks, Feed, Medicines, Vaccines,
 Veterinary services
 Take back the end products
 live birds / eggs
 The real owner of the birds
Role of integrator

6. 
 Must have shed, feeders, waterers and other
equipment,
 Own electricity charges,
 Own labour charges,
 Must follow the integrators instructions,
 Get remuneration on take back of end products,
 they are contract growers.
Role of producer

7.  Vertical integration
 Backward integration,
 Forward integration.
 Horizontal integration
 Parallel integration
Types of integration

8. 
 Association between different stages of production
starting from a base operation such as breeding,
hatchery, commercial farm, processing unit and
marketing channel in order to utilise the outputs of one
unit as input of the other unit.
 This will ultimately reduce the cost of final product,
namely the egg.
 When more than one stages of producing and marketing
a poultry product are controlled by the same individual
or company reduce production cost of final product
(egg) without affecting profit margin of integrator.
Vertical integration

9. 
Forward integration:
Here in order to fetch a better
price for his output/product, integrator will start his
own processing plant or marketing centre.
Backward integration:
In this case, the farmer or
integrator, inorder to obtain his input at a cheaper rate,
say chicks, he will start his own hatchery or breeeder
farm.

10. 
 Association, amalgamation or merging of companies
and units engaged in same type of production (like
merging together of 2 or more hatcheries,
commercial farms, processing plants etc).
 Results in increase in volume of operation and
expansion in production.
 Sometimes lead to either unhealthy competition
among integrators or even monopoly which are not
good for poultry industry.
Horizontal integration

11. 
 This type of integration is also called as diversification.
 Here integrator may start allied industries like a
hatchery operator may go for manufacturing the
incubator and use it for his own hatchery or sales.
 This type of integration not only reduces the cost of
production, but also obtain additional revenue by
selling diversified products.
Parallel integration

12. 
Two types of integration
 Grower integration
 Layer integration
Types of integration

13. 
 Day- old layer chicks are given to producers,
 All inputs are being provided,
 Reared upto 15 weeks of age,
 Growers are taken back.
Grower integration

14. 
 Starts at the age of 15-18 weeks,
 Remuneration based on HHEP,
 6-8% of standard mortality will be allowed.
Layer integration

15. 
 Advantages to integrators
 Assured returns
 Can have control
 Owner of the products
Advantages of
integration

16. 
 Advantages to farmers
 No huge investments,
 Assured remuneration,
 Need not worry for market,
 Need not bother about health care.

17. 
 Mushroom growth of independent small farms and
other production units can be avoided,
 Production cost of final product will come down,
 Industry will grow in an organized way, after an initial
struggle,
 Possibility for production of diversified products and
fast foods,
 All main and byproducts will be utilized and recycled
(no wastage) thus prevent environment pollution,
 Stabilize the prices by balancing supply and demand.
Advantages to poultry
industry

18. 
Integration in layer farming may
result in spectacular growth in the
industry by better marketing approach
and reducing the total cost of
production, but sometimes it may lead
to monopoly in the industry.
Conclusion:

19. 