1. Evaluation of periodical changes in Market margin in Different Livestock Products R.M. Chandrasena Asst. Director Div. Farming Systems Economics and Marketing 2010-2011

2. Objectives  To determine cost of production of livestock products in different production systems and to estimate their market margins  To forecast future production trends with the changes in the cost of different inputs  To estimate major cost components between producer and the consumer price

3. Expected output  Small scale farmers are benefited by knowing the total cost and then to determine appropriate salable price  When fixing control price, this study would benefit in determining a fair price to both producer and consumer  Useful in determining value addition

4. Goat Marketing System Broker Producer Tender / Collector Butcher Retailer

5. Beef Marketing System Agent Producer Tender / Collector Butcher Retailer

6. Pig Marketing System CollectorButcherRetailer Producer CollectorProcessor Consumer

7. Buffalo Milk Curd Production Farmer / Producer Selling Price - Rs.55.00/ lit (55-60) Transport Curd Production Labor - Rs. 2.50 Pot - Rs. 12.00 Other- Rs. 3.00 Total Production Cost =Rs.(55.00+2.50+12.00+3.00) =Rs.74.00 One liter Curd Pot (74-80) Buying Price Retailer Rs. 110 (110- 112) Consumer Price Rs. 130.00 (130 -140) Rs.1.50/lit (1.50-2.00) Transport Rs.2.00

8. Beef Marketing Channel and Market Margin Distribution (Anuradhapura) ProducerBroker Agent / Collector Butcher Retailer Selling Price Rs.320/Kg (100%) Producer Selling Price Rs.208/Kg (65%) Marketing Margin Rs.112/ Kg (35 %) Broker 2% Rs. 6.40 Transport 3 % Rs.9.60 Agent 7% Rs.38.40 Retailer 11 % Rs.35.20 Bucher 12 % Rs.38.40

9. COST OF PRODUCTION BROILER CHIKEN (1 Kg) Rs-1.5 Kg 74+34 Rs.111.00 B.F-1.8 Kg 68-56Rs. 122.40 InputsRs. feed 223.40 223.40 Chick 50.00 50.00 Water 2.00 2.00 Light 5.00 5.00 Labor 16.00 16.00 S*P 15.00 15.00 Total cost / Broiler 311.40 311.40 (Assumption Average Dress Wt = 1.5 Kg) Cop 1Kg = 210.00 S*P – Slaughter and packing

10. Broiler Chicken Market Margin COP Rs. 210.00 /Kg Producer Price Retailer Buying Price Rs. 320.00 Retailer Selling Price Rs. 370.00 Rs. 250.00 (100%) (67.5%) Mm (32.5 %) Rs. 120.00

11. Beef Marketing Channel and Market Margin Transport from Remote Area to Urban Area(1Kg) (Lunugamwehera / Thanamalwila / Monaragala) Producer Price Retailer Price Rs.450 (100 %)Rs.450 (50 %) Market Margin Rs. 225 (50 %) Barracker 9.00 Agent 36.00 T.P 22.50 Other 13.50 Bucher 67.50 Retailer 76.50

12. MUTTON MARKETING CHNAL AND MAKET MARGIN (Consumer Average Price Rs. 750.00/ Kg ) Producer Price Rs. 500.00 /Kg (67 %) Broke Price Rs. 15.00 (2 %) Trader / Collector Price Rs.67.50 Butcher Price Rs 75.00 /Kg (10 %) Retailer Price Rs. 90.00 /Kg (12 %) Consumer Price Rs. 750.00/kg PRODUCER Rs.500.00/kg (67%) CONSUMER Rs.750.00/kg (100%) Market Margin Rs. 250.00/ Kg (33 %)

13. YOGHURT PRODUCTION Producer cop / Price Rs: 9.00/cup Producer Selling Price Rs. 15.00/ cup Retailer buying Price Rs.15.00/ cup Consumer Price Rs. 20.00/ cup Profit Rs. 6.00 Profit Rs. 5.00/cup

14. Rs. 220 per Kg Cost of Production Producer Price Rs. 260 /= per Kg Bucher Rs. 320/= per Kg Retailer Price Rs.400 /= per Kg Rural Area Pork Marketing Channel & Market Margin

15. Pork Marketing Channel 2 Market Margin Producer Price Cop 240.00 Retailer Price Market Margin Rs. 160.00/ Kg (35 %) Rs. 290. 00 (65 %) Rs. 450.00 (100 %) T.P 18.00 Other 9.00 Bucher 67.50 Retailer 76.50 Collector 36.00 Broker 9.00

16. Milk Collection, distribution and Consume Systems

17. Progress  Secondary Data collection completed.  Informal discussion with key personal completed.  Development of questionnaire completed.  Field survey completed.  Data edits completed.  Data analysis completed.  Terminal report writing in progress.

18. Some of the major issues in Agricultural marketing  High price fluctuation  High market margin  Poor infrastructure facilities.  Lack Integration between Input supply, Production, and Marketing.  Heavy post harvest losses.  Influence of the middleman in Agricultural Marketing process.

19. Constraints  Supporting services were not available and thus expenditure on personals remained unspent  Difficulties in accessing reliable data sources in various agencies

20. Observations  The market margin changes with the weather condition, festival season and natural disasters.  There were two types of marketing channels Short channel-Both producer and consumer benefited Short channel-Both producer and consumer benefited Long Channel-High waste, Low margin for producer and high purchasing price for consumer Long Channel-High waste, Low margin for producer and high purchasing price for consumer  Extent of value addition can be determined  Product supply through export is heavily depend on the forecasted demand of the hotel keepers  Main factors which determines the retail price are population density and the religion

21. Acknowledgements  Department of animal production and health for funding the project  Director VRI all the staff and research monitoring committee  Provincial councils, Milco, Nestle, NLDB for their invaluable support in various aspects

22. For further information, please contact; Director Veterinary Research Veterinary Research Institute, Gannoruwa, Peradeniya.