Trop Anim Health Prod (2014) 46:797–808 DOI 10.1007/s11250-014-0568-7
REGULAR ARTICLES
Evaluating critical factors to the economic feasibility of semi-intensive pig rearing in western Kenya Mike Levy & Cate Dewey & Alfons Weersink & Florence Mutua & Natalie Carter & Zvonimir Poljak
Accepted: 27 February 2014 / Published online: 15 March 2014 # Springer Science+Business Media Dordrecht 2014
Abstract The purpose of this research is to assess how season, ADG, opportunity costs of farm-grown feeds, pig weight, and butcher price variation impact the economic potential of semi-intensive pig rearing. We developed a unique algorithm that emulates least-cost pig feeding and used it to assess the impact of the aforementioned factors on farmers’ maximum revenue and profit potential when pigs are sold to local butchers in western Kenya. When considered as independent factors influencing feed costs to grow a pig to a market weight of 30 kg, variation in ADG, opportunity cost of feed, and weaning season resulted in feed cost differences of up to 982, 947, and 379 Kenyan shillings (KES), respectively. The variation in revenues attributable to butcher or butcher negotiation and seasonal variance of butcher prices for a 30 kg pig was 744 and 225 KES, respectively. Feed items most commonly chosen for least-cost feed rations were small dried fish, cooked ground maize, whole maize, millet, cassava foliage, sweet potato vines, bone meal, avocado, and mango. Smallholder farmers who can feed pigs to reach higher ADG have lower opportunity costs of feeds and/or who effectively bargain with butchers can benefit from semi-intensive pig rearing. Farmers without access to at least some zero-cost feeds and farmers with opportunity costs of feeds exceeding 50 % of the market price will not earn positive returns from semiintensive pig rearing. M. Levy (*) : C. Dewey : N. Carter : Z. Poljak Department of Population Medicine, Centre for Public Health and Zoonosis, University of Guelph, Guelph, ON N1G2W1, Canada e-mail:
[email protected] A. Weersink Food, Agricultural, and Resource Economics, University of Guelph, Guelph, ON N1G2W1, Canada F. Mutua Department of Public Health and Toxicology, University of Nairobi, Nairobi, Kenya
Keywords Pigs . Smallholder farms . Weight gain . Feed costs . Linear program . Kenya . SSA
Introduction Pig rearing is an important livelihood activity for many smallholder farmers across Sub-Saharan Africa (SSA) (Mutua et al. 2011; Halimani et al. 2013; Madzimure et al. 2013). Traditional management systems (i.e., pigs run free range and scavenge for food) predominate (Lekule and Kyvsgaard 2003) because of the economic feasibility (Verhulst 1993), but there are negative consequences. Allowing pigs to scavenge on land dedicated for agriculture has been a source of conflict between neighbors and has led to pigs being killed (FAO 2012; Mutua et al. 2010). Free-ranging pigs contract parasites (Kagira et al. 2010a) and zoonoses such as Taenia solium (Thomas et al. 2013; Mutua et al. 2011; Lekule and Kyvsgaard 2003). The economic feasibility of semi-intensive pig production (pigs confined and food provided) is important to consider for improving pork safety (Lekule and Kyvsgaard 2003) and social harmony. A better understanding of the critical factors that enable smallholder farmers to economically benefit from semi-intensive pig rearing may help to direct extension efforts and inform policy makers in SSA who advocate confining pigs (Madzimure et al. 2013; Mutua et al. 2010). Because feed costs account for 70–85 % of pig production costs (Verhulst 1993; FAO 2012), several research studies have focused on feed optimization, either by generating least-cost feed rations (Olorunfemi 2007; Parris and Devendra 1972) or by performing feed trials (Balogun and Bawa 1997; Parris and Devendra 1972; Alhassan and Odoi 1982; Tuitoek 1992). The feed recommendations that result are only optimal if the farmer has access to the recommended feeds at a similar cost (relative to other feeds) evaluated by the
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researcher (Jackson 1981). Little attention has been given to the variety of conditions and constraints smallholder farmers face and the resulting impact on their feed choices and the overall cost of pig rearing. Season influences the prices and feeds available because locally available and farm-grown feed items change seasonally (Kagira et al. 2010a; Mutua et al. 2012). The opportunity costs of feeding pigs farm-grown feed vary with productivity and marketing potential of the farmgrown feeds (Amills et al. 2013). Poverty levels influence the quality and quantity of feeds a farmer is able to provide which influences the average daily gain (ADG) of pigs (Mutua et al. 2012; Carter et al. 2013). Nutritional requirements for body weight maintenance and growth differ with body weight (NRC 1998). All of these factors influence the appropriate least-cost feed rations. In addition to feed costs, farmers’ economic benefit from pig rearing is influenced by the price they receive for pigs. Results of pig-rearing feasibility studies vary. Traditional, semi-intensive and intensive pig-rearing systems in Nigeria have all been found to be profitable (Akanni and Onasanya 2004; Ogunniyi and Omoteso 2011; Adetunji and Adeyemo 2012), while only traditional husbandry practices were found to be profitable in Burkina Faso and Cameroon (Verhulst 1993). Lemke et al. (2007) compared extensive (i.e., using indigenous pigs in rural locations) and intensive (i.e., using improved breeds in more urban locations) pig systems in North Vietnam and found no difference in the net economic benefit between the two pig-rearing systems. Although profitability was addressed in these studies, the variability of prices that farmers received because of trader variability, seasonal variation of pig prices, and the influence of marketing weight on the economic impact to farmers were not quantified. This information would be valuable for smallholder farmers to enhance their marketing decisions regardless of their production objective. Most rural farmers in resource-poor locations have the objective of earning higher total revenues rather than profits (Lemke et al. 2007). The purpose of this research was to evaluate the economic potential of semi-intensive pig rearing under local marketing conditions in western Kenya and to assess the relative importance of season, ADG, opportunity costs of farm-grown feeds, pig weight, and pig price variation on economic outcomes. We developed a software algorithm to emulate least-cost pig-feeding under a variety of scenarios. A linear program is nested inside the algorithm to determine least-cost feed rations and daily feed costs for each combination of the following factors: season, opportunity cost of farm-grown feed, ADG, and pig weight. Economic feasibility was evaluated by determining both the profit-maximizing and total income-maximizing market weight of pigs.
Trop Anim Health Prod (2014) 46:797–808
Materials and methods Study location The study was conducted in the rural Busia District, in the Western Province, Kenya where most people live via subsistence agriculture. Busia has high levels of poverty and high population of pigs and was included in several previous research studies on pig butchers and smallholder pig farmers (Mutua et al. 2010; Mutua et al. 2011; Kagira et al. 2010b; Carter et al. 2013; Kagira et al. 2010a). To our knowledge, there have been no studies of the economic potential of pig rearing for smallholder farmers in this location. Farmers feed their pigs combinations of farm-grown, free, and purchased feeds (Mutua et al. 2012). The feeds most frequently given to pigs were ugali (ground maize with or without millet cooked in oil and water) (88 % of farmers), kitchen leftovers (83 %), omena (small dried local fish) (78 %), sweet potatoes (75 %), sweet potato vines (65 %), cassava (57 %), brewers’ waste (48 %), maize (33 %), fish innards (30 %), and less frequently vegetables, mango, avocado, and banana peels (Mutua et al. 2012). Kagira et al. (2010a) reported similar feeds and also included swill collected from local markets. Software algorithm We developed an algorithm to emulate growing a pig from weaning weight to market weight for every combination of weaning month (January to December), opportunity cost of feeding pigs farm-grown feeds (100, 75, 50, 25, 0, and 0 % of the market price with no free feeds available; where 100 %= full market price, whereas 50 %=half market price), and ADG (80 to 180 g per day in 25-g increments). At each pig weight and for each combination of factors, the algorithm used a linear program to determine the least-cost feed ration and feeding cost required for feeding a pig to gain 1 kg. The incremental feeding cost and the cumulative feeding costs were tracked. For each pig weight, the cumulative feeding cost and piglet purchase price were added together and compared to the price that could be received if the pig was sold to a local pig butcher. The main components of the algorithm are presented in Fig. 1. The assumptions used to create the algorithm are presented in Table 1. Before the linear program is executed, several adjustments are programmatically made to the inputs. Feed availability is adjusted based on the month the pig is fed (determined using the weaning month of the pig and the ADG being evaluated). The cost of feed and the nutrient requirements of the pig are adjusted based on the opportunity cost of feed and the ADG being evaluated, respectively. Items that were made available at 0 opportunity cost (free) in small quantities when in season include avocado (
