Economic analysis of broiler production in Korea (1980-95)

Abstract

The economic analysis of broiler production is investigated in this research in relation to structural changes by different size of chicken farms and Markov model analysis. The transition probability for farms with less than 5,000 broiler chickens was between 35% and 10% during the period 1980-95, while for over 30,000 chickens there were 14% to 35% remaining in business. The transition probability of chicken farms with 5,000 to 30.0 chickens was 51% to 57% during the same period. The optimal size of a broiler chicken farm with one person of labour input is 3,333 chickens and these farms average 1.6 million Won (US$ 1964.40, 1 US$=814.50 Won, October 25, 1996) income. The optimal size for two persons of labour input is 6,666 chickens with 3.2 million Won (US$ 3928.79) income. The average labour productivity of broiler chicken production is much lower than book-keeping farms. The consumption of chicken meat has been increasing by the increasing level of GNP per capita. However, the level of producer price per kg has not increased at the same rate as labour and feed cost during this time period.