Vano group through his director general brought up the idea of applying what is called VERTICAL INTEGRATION OF SMALL FARM HOLDERS THROUGH CONTRACT FARMING PROGRAM for rehabilitation of broiler industry in Kurdistan. His effort along with some other collogues in poultry sector resulted in allocation of $ 12 millions by ministry of agriculture for this program. The money will be lent to integrators with out any profit according to certain conditions.
The program is a contract between the poultry farm owners and some companies (integrators) which have facilities for producing day old broiler chicks, feed mill, hatcheries, slaughter house, vaccines and medicines.
In this program the companies (integrators) will supply the farmers with:
1- Day old chicks
2- Feed
3- Veterinary supplies
4- Technical supports
5- Implement the final marketing of the out put
The farmers provide:
1- Land and housing
2- Equipments
3- Litter
4- Labor (family and/or hired )
5- Daily farm management
At the end, the integrator buys the product from the contract farmers by paying a pre determined price per kg, or paying the farmer 17% of the cost as profit.
Due to heavy losses the poultry sector suffered in away left them incapable to restart the business again by them-self alone, this program is the only way for them to revive their farms, since they will need only to procure around 25% of the cost of the inputs required for broiler production, and the rest 75% will be provided by this program.
This program has been applied in some countries like U.S.A. and Brazil long time ago and now applied in many countries like India, Bangladesh, Thailand, etc.
Almost about 99.5% of broiler meat in the U.S.A. is produced through this kind of program.
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