Asian Journal of Agricultural Sciences 3(6): 492-499, 2011

ISSN:2041-3890
© Maxwell Scientific Organization, 20011
Submitted: August 26, 2011 Accepted: October 15, 2011 Published: November 15, 2011

An Analysis of the Broiler Supply Chain in Swaziland:

A Case Study of the Manzini Region

Micah B. Masuku
Department of Agricultural Economics and Management, University of Swaziland,
Private Bag Luyengo, Luyengo M205, Swaziland

Abstract: This study analyses survey data gathered in 2009 from contract and non-contract broiler farmers in
the Manzini region of Swaziland. A descriptive research design was used in the study and data were collected
using personal interviews. The results show that the same type of inputs were used in both production systems
with the only difference being the quantity of inputs used in each system. The results also revealed that
productivity is higher for contract farmers as they produce birds with an average weight of 1.8 kg in 5 weeks
and also produce an average of 34,500 birds per batch. The results further indicated that consumers buy live
birds mostly from non-contract farmers and buy processed birds from contracted farmers. Consumers pay more
for a bird produced through the contract system than a bird produced through the non-contract system. On
average birds produced under non-contract system cost consumers E28.00 whilst birds produced under the
contract system are sold on weight basis and costs the consumers E20.99 per kg. Thus on average consumers
pay E32.50 for a whole bird produced under the contract system. The cost of producing one bird is high with
non-contract farmers than is for contract farmers. With increasing competition and changes occurring in
markets, producers need to understand and improve the effectiveness and efficiency of the broiler supply chain.
This will often require a combination of firm-level actions as well as improvements in the entire value-chain.
There is also a need for political will by government to protect farmers by promoting competition through
enacting competition legislations and allow transparency within the value chain.

Key words: Broiler chickens analysis, poultry contracts, supply chain

INTRODUCTION in a number of homesteads is chicken (Callus domesticus)

species. Many farmers keep chickens for meat
Approximately 80% of the population of Swaziland consumption purposes. This has been more advantageous
is found on the Swazi Nation Land (SNL), where because it has been easy to manage them in terms of
agricultural practices are prominent. Agriculture feeding and treatment. Chickens were exposed to
contributed 11.9% to the gross domestic product in 2008, scavenging systems for feed and received little
while the agricultural activities conducted on the SNL supplementary feed. There was no provision for housing,
contribute about 5% of the gross domestic product of the thus they were characterised by low input and low output.
country and about 70% of the Swazi people depend on According to Masimula (2004), surveys indicated that
agriculture as a source of income and employment 91% of families in rural areas of Swaziland mostly raise
(Thompson, 2010). chickens.
Commercial poultry in Swaziland started in the late Poultry activities in Swaziland are carried out by
1960s with most poultry farmers engaged in egg most farming communities. These poultry farmers are
production and it was mostly concentrated in few selected found in both Swazi Nation Land (SNL) and Title Deed
rural development areas (RDAs) (Dube, 1991). The Land (TDL). They include smallholders to medium and
importance of poultry was over the years emphasized on large producers. In the past years medium and large scale
egg production. This was made possible by the United producers were found only on TDL, but with the
Nations International Children Emergency Fund establishment of the Swazi Poultry Processors (SPP) in
(UNICEF), which was providing egg producers with Matsapha industrial area, these categories are also found
battery-cages. In the seventies the country faced an on Swazi Nation Land (Masimula, 2004). In the early
evolution from egg production to broiler production. 1990s, local farmers started to become aware of the
Broilers refer to a group of birds reared for meat as a viability and sustainability of utilizing agricultural land
source of food. Some of the birds that are common in the for poultry production specifically on land unsuitable for
domestic exercise are chickens, turkeys, ducks, geese and crop farming. This resulted in the creation of a forum
pigeons. They are only refereed to as poultry when they where both large and small producers of eggs, live
are domesticated. The most common type of poultry kept chickens and slaughtered birds could meet. These

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producers realized the need for an official body to handle birds in large flocks. Broilers are being produced
represent their interests hence the Swaziland Poultry worldwide and trials have been implemented to produce
Producers Association (SPPA) was formed (Masimula, the best quality meat at a very short space of time. It is
2004; Mabila, 2006). predicted that the consumption of poultry meat will
Local poultry farmers face unfair competition from continue to increase in the future in form of new
imported and often dumped poultry products from other processed poultry products. Genetic improvement in
countries, such as South Africa. Swaziland is poultry has played a major role in the quality of meat
unfortunately quite vulnerable in this respect because of produced. This also led to the production of a meat type
the big gap that exists between levels of local production chicken that weighed over 2 kg at seven weeks of age
and that of the retail trade. The consumer market is having been fed on only 4 kg of a balanced diet. The main
dominated by an organized supply sector, closely linked principle that is used when rearing broilers states that a
to a developed economy in South Africa and equipped producer should keep birds of the same age on the same
with all the latest marketing, advertising and promotional site so that they are ready for sale at the same time. They
skills. The poultry sector in Swaziland is ready and are ready to be slaughted at eight weeks of age. In a year,
capable of supplying a major part of the demand for eggs 5 batches of broilers can be raised because an allowance
and meat. However the development of this potential of two weeks has to be allowed between any two batches
depends heavily on correction of the present market through out the year. This study examines the broiler
distortion, which need to be addressed (Freeman, 1997; supply chain with a view of conducting the economic
Robinson, 1998). analysis of the supply chain.

Importance of poultry farming: Poultry farming is an Vertical poultry production contracts: Contract in
important way of improving income and employment for broiler production may vary from country to country and
the rural poor population in developing countries. Poultry the nature of the contractor. Contracts in broiler
production is also a strategic way of addressing animal production mean agreements between farmers and
protein intake shortage in human nutrition because of its integrators that specify conditions of producing and
high productiveness, fast growth rate, short generation marketing broilers. There are mainly two types of
interval and unparallel competence in nutrient contracts and these are production and marketing
transformation to high quality animal protein. Most contracts (Scott, 1984; Little and Watts, 1994). With
countries have government departments responsible for production contracts the quality and quantity of
the development of poultry. The effectiveness of such production inputs are determined and supplied by the
departments varies, but the main hindrance is usually contracting firm. The compensation that the grower
limited and lack of trained administrators, researchers and receives for services is also decided by the contractor.
extension workers (Stewart and Abbott, 1981). Marketing contract refers to an agreement between a
According to Abbott (1965) developing countries contractor and a grower that sets a price and the market
have a growing trade deficit in products, and now Africa outlet before the broilers are ready to be marketed. Most
accounts for thirty percent of the world's annual poultry management decisions remain the responsibility of the
imports which makes adequate research a necessity for grower. In marketing contracts, only the price risk is
development. He also argues that small-scale farmers shared whereas in production contracts, both production
make up the bulk of all producers and that makes them and price risks are shared by the grower and contractor.
major contributors in poultry development in Africa. The contractor may have more control over production
Poultry for both small and large-scale producers should be decisions depending on the type of production contract
encouraged for several reasons in developing countries. (Little and Watts, 1994).
According to Vilakati (2000), poultry production has to be According to Cunningham (2005) vertical production
encouraged because of nutritional, social and economic means that all or most production aspects are owned and
reasons. Eggs and poultry are an excellent source of controlled by an individual company called an integrator.
proteins and energy. Poultry production can be a way of The integrator provides the contractee with chicks, feed,
improving a lot of low income groups in rural areas, thus medication and technical advisors to supervise farm
improving the living standards of the individuals. production. A contract broiler farmer has to prepare his
Production of broilers has shown to be an important houses and equipment to meet the specifications
venture, thus new technology has been and is still recommended by the broiler integrator with which he is
introduced in developed and developing countries. planning to contract (Laura, 1994). It is important that the
Mountney et al. (1988) commented that technological prospective farmer gets a signed contract before buying,
advances in broiler production developed in the United constructing, or renovating a poultry farm. Otherwise, he
States and other countries in the last 40 years have been may spend a large amount of money and end up with no
rapidly applied worldwide and have made it possible to company interested in placing chicks in his facilities.

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Companies do not place chickens in houses just because The clean side includes the evisceration, packing, dispatch
they are available. Companies try to screen prospective and stores department. The Maintenance department is
producers closely to determine whether they will be good where they fix and maintain damaged machineries needed
business partners. Each company wants an honest, for processing.
dependable, hard working person or family who is well
respected within the community. Companies invest large SPP issues contracts to broiler farmers under the
amounts of money in the chickens, feed and field service following conditions:
workers.
Under the contract system, the company retains C The farmer must prepare the poultry house that can
ownership of the birds and expects producers to grow accommodate at least 5000 chickens
their flocks under very specific management programmes. C A farmer has to write a formal letter to SPP
Company field representatives normally visit farms indicating his/her interest in working with the
weekly to assist with management, but they may do so company;
more often if necessary. Vertical integration reduces C The farmer must be within a radius of 30 km from
production costs through coordinating and professionally the company to minimize costs of transport and the
managing each production stage. This approach not only area must be accessible for ease of transportation
improves cost efficiency, but also permits the production C The house plan must provide suitable environmental
of more uniform birds in large volumes necessary to conditions for the chickens, for example the floor
successfully compete in the market. In this system, the must be cemented, there must be curtains to prevent
integrator is responsible for all processing facilities, rain and also allow ventilation, there must be enough
processing labour and salaries, and marketing activities equipment for feeding
crucial to the success of the poultry business. Processing C After the completion of the structure, an inspector
and marketing are very specialized and require must be called to inspect the structure if it is ideal for
considerable expertise and experience for success. For rearing chickens
this system to work effectively, integrators and producers
make significant contributions to the processed depend on If the poultry house is found to be in the right
each other (Cunningham, 2005). condition then the farmer is allowed to join the contract
growers and SPP provides the following: day old chicks.
Contractors (Swaziland Poultry Processors (SPP)): These chicks are from the National Chicks, which is the
The Swaziland Poultry Processors (SPP) is a processing company's sister company; feed and medication for the
company that deals with the processing of birds into chicks through Feed Master, Crane Feeds and or Arrow
various packs. This company was formed by Insika Feeds. Feed and vaccines are provided until the chickens
Yemaswati after the loss of market for live birds in 1999. become 35 days old; and a supervisor who does regular
SPP is now the largest chicken abattoir in Swaziland, it is visits to the broiler growers.
situated in Matsapha Industrial site. On average it When the chickens are ready for slaughter at 35 days
slaughters 20,000 chickens a day. It started as a small they are collected from the farm, and the farmer is paid
company with a staff of about 70 people who were according to the weight of the chickens, but the company
slaughtering 5000-8000 chickens a day. Lately its deducts the costs of chicks supplied, cost of feed and
production has greatly increased to 300 workers and medication. The farmer has to provide security against
20,000 chickens slaughtered a day. They produce various thieves and predators. The farmer should also practice
products which give a wide range of choice to customers good management practices. However if the chickens die
(Ndlandla, 2009). because of a disease outbreak the expenses are shared
Ndlandla further stated that, the company is working between the farmer and the company. The company
hand in hand with contract growers and Feed Master (a provides the farmer with an allowable mortality rate of
feed mill company based in Matsapha. The chickens are 5%, but if the mortality rate is higher than this, the farmer
grown up to 35 days, after that they are ready for has to justify the cause.
slaughtering. Feed Master sells to contract growers feed Swaziland Poultry Processors (SPP) uses contract
and vaccines to control diseases on credit. prices with her contract growers, while the contractor
The SPP is divided into three departments, the dirty advances the cost of growing stock, feeds and veterinary
side, the clean side and the maintenance department. The supplies and services, these are later charged in full to the
dirty side is where the live birds are received as they come contract grower at the time of harvest and sale of output.
from the farmers, slaughtered and dressed. The way each In essence, growing stock and feeds are provided by the
department is built is meant to serve its purpose, which is SPP on credit. The stock used and feed consumed are, in
different from the other departments. The separation of fact, evaluated at prevailing market prices, with a mark-up
heads and feets from the chicken is done at the dirty side. imposed for relevant charges (for example, costs of

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transport to the farm, cost of stock or feeds supplied on harvesting equipment, and feed in the case of broiler
credit). Contract prices are more suitable when close production) and make major decisions about production
supervision is not possible, as it reduces the incentives to systems, spraying and harvesting schedule. Contract
divert integrator’s inputs to other uses. farming is the most obvious example of how family
farmers are industrial field workers, stripped their
Advantages of contract farming: According to Kunkel managerial decision making powers and left with only
et al. (2005) there are several potential advantages for their nominal independence (Vogeler, 1996).
producers who consider production contracts. The
contracts may provide a more s income for the producer Supply chain analysis: A supply chain is the series of
by reducing traditional marketing risks. The contracts may interlinking steps that determine the nature, character and
allow a producer to benefit from technical advice, value of a product at the time of receipt by the end
managerial expertise and access to technological advances consumer (Peterson et al., 2005).
provided by the contractor. An agricultural production Supply chain management (SCM) comprises the
contract may provide the producer with a guaranteed management of five flows between departments and or
market provided that the commodities are produced in organizations: materials (the raw materials and
accordance with the contract. Finally, such contracts may components to produce a product), products (finished
allow a producer to increase the volume of his or her goods), services (either to support the product or stand
business with limited capital, since the contractor supplies alone services), information (to recognize and satisfy
the necessary production inputs. However, by entering demand), and cash (the supply chain impacts the speed
into production contract that establishes a formula for and efficiency of cash flow). There are four overriding
compensation, the producer may lose the potential for concepts that are applied in the efficient execution of
increased profits due to market conditions. Ruthenberg supply chain management: linkage (the tying together of
and Jahnke (1985) argue that there is a rapid production processes, practices, and information), velocity
increase by mobilizing smallholder production (increasing asset utilization), reliability (meeting
opportunities, mobilization of entrepreneurial talent on commitments), and flexibility (responding to changes in
everyone, including smallholders farmers. customer needs). These flows and concepts combine in a
According to Vogeler (1996), from the contractor's variety of ways to produce of multitude of supply chains
perspective, production contracts may provide an orderly that support different product characteristics, market
flow of uniform commodities in order to allow the demands, product life cycles, and geographic markets.
contractor to control production costs and such contracts
to better respond to changing market conditions. METHODOLOGY
Contracts give agribusinesses the advantage of treating
farmers as employees without paying them as employees. Research design: The study utilized a descriptive
Furthermore the pseudo independence status of farmers research design applying a quantitative and qualitative
motivates them to work even harder than hired approach. The research used primary data which were
employees. gathered in 2009 through a structured questionnaire using
interviews.
Disadvantages of contract farming: According to
Vogeler (1996) the independent management of farms is Subject selection and sample size: The target population
critical to the concept of family farms. To protect for the study was contracted and non-contracted broiler
themselves against widely fluctuating incomes and the farmers in the Manzini region of Swaziland. Non-contract
inability to get credit from banks, many farmers engage in farmers are independent farmers who are rearing broiler
contract farming. When farmers sign contracts with birds and sell them in the open market. Contracted
processing companies, they can retain the illusion of farmers are those who have formal agreements with the
independence because they are self employed but they Swaziland Poultry Processors (SPP), where the later
effectively become employees of the companies. Kunkel supply day old chicks and inputs on credit to the farmers,
et al. (2005) also adds that since such contracts are often who later supply broilers to SPP. A purposive sample of
very specific in their requirements and limiting the fourteen (14) farmers under contract broiler farming and
producer's interest in the commodities produced, the twenty eight (28) farmers under non-contract broiler
producer may become a mere provider of production farming in the Manzini region was used in the study.
services for a fee.
Contracted farmers provide land and labour and make Data collection and analysis: Data were analysed using
low-order decisions, while the companies provide descriptive statistics. The Statistical Package for Social
everything else (seeds, fertilizer and usually the Sciences (SPSS) version 10 was used to analyse the data.

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Table 1: Demographic characteristics of the farmers

Characteristics Frequency Percentage
Males 24 57.1
Females 18 42.9
Number of farmers who have reached primary school 1 2.4
Number of farmers who have reached secondary school 6 14.3
Number of farmers who have reached high school 4 9.5
Number of farmers with Technical education 25 59.5
Number of farmers with tertiary education 6 14.3
Proportion of farmers who are on Swazi nation land 30 71.4
Proportion of farmers who are on Title deed land 12 28.6
Proportion of farmers who are part time poultry producers 29 69.0
Proportion of farmers who are in livestock or crop production 29 69.0

RESULTS AND DISCUSSION machines are accessed from hardware shops in South
Africa. Automatic machines include feeder tanks, feeding
Demographics of poultry farmers: The results in lines, water tanks and drinking lines. The automatic
Table 1 show the demographics of broiler farmers. The machines are common with large scale producers and this
results indicate that broiler farmers in the Manzini region is because large scale broiler farmers keep an average of
have on average an experience of six years in the broiler 64,000 birds per batch. Therefore, the automatic machines
industry. This implies that the farmers are experienced in are used to increase the efficiency of the farms and to
the field although a large number of them had the least enhance productivity.
experience and the most experienced farmers had one Broiler farmers access feed inputs from feed
year and eighteen years respectively. The results further processing firms within the country. These firms include
show that broiler farmers in the Manzini region were 52 Feed Master, Arrow feeds and Crane feeds. Feed is
years of age on average with a majority of them aged produced in three forms, which is starter mash, grower
between 50 and 59 years. This indicates that most of the mash, and finisher mash. Farmers purchase the feed from
farmers that the farmers ventured into broiler production the firm sites or from the firms’ depots found in almost all
just before retirement or at retirement as most of them over the country. Large scale producers buy feed in large
indicated that they had been employed before entering quantities and the feed producing firms transport the feed
into broiler farming. The broiler industry is mostly to the farm sites for these farmers. Upon arrival on the
dominated by men as the results show that 57.1% of the farm the feed is offloaded into storage tanks where it is
farmers were men and 42.9% were women and most stored for the duration of the feeding period. Farmers who
(69%) were part-time farmers. use automatic feeders connect the feed storage tanks to
the feeding lines which have automatic feeding system.
Description of the poultry industry supply chain:
The inputs side: The broiler industry supply chain begins
Supply of day old chicks: The National Chicks is a firm
with the supply of production inputs. The production
involved in the breeding and selling of one day od chicks.
inputs used in the broiler industry differ in terms of their
The firm sells chicks to all broiler farmers country wide.
use in the farm in terms of their costs, in terms of their
Among the shareholders of National Chicks are farmers
significance in the production of broilers and in terms of
with contracts to supply SPP. National Chicks has been
their frequency of being used in the production of broilers.
The inputs needed in broiler production include chicks, for many years the only supplier of chicks in the country.
medication, and building material, feeding and drinking She has been without competition until Kharafa trading
utensils, lights, heating and cooling machines. These company in Manzini ventured into the industry. Currently
inputs are accessed from the local and international there are many other suppliers of imported one day old
retailers such as Kharafa trading company for the drinkers chicks. National Chicks is selling her chicks at E4.10 a
and feeders. The prices for these equipment range from chick to the general public, but they are sold at E3.80 to
E40.00 to E60.00 depending on the size of the feeder or contract farmers.
drinker as they come in different sizes. Kharafa is currently importing breeding eggs from
The prices also differ from one trader to the other as South Africa and produce day old chicks. She then sells
the equipment is accessed from different retailers which the day old chicks at E4.05 to all broiler farmers. Kharafa
include Kharafa, TUMS general suppliers and some other has depots country wide to enable all broiler farmers to
hardware shops. The large-scale producers mainly use access her products. Currently National Chicks and
automated equipment such as automatic feeders and Kharafa are the only companies providing farmers with
drinkers which cost from a range of E50, 000 to E150, chicks in the Manzini region. These two suppliers of
000 per feeder and drinker system. The automatic chicks also sell medication for the broilers.

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Table 2: Production of broilers under contract Table 3: Production of broilers under non-contract
No of birds Kept per Frequency Percentage No of birds per Batch Frequency Percentage
4000-8000 5 38.5 200-600 9 32.1
8001-12000 1 7.7 601-1000 8 28.6
16001-20000 1 7.7 1001-1400 1 3.6
32001-36000 1 7.7 1401-1800 3 10.7
48001-52000 1 7.7 1801-2200 4 14.3
56001-60000 1 7.7 >2201 3 10.7
60001-64000 2 15.4 Total 28 100.0
> 64001 1 7.7
Total 13 100.0
the number of birds each contracted farmer produce per
batch for the farmers producing above 50, 000 chickens a
The production side: The production sector is divided batch. The contractor can at some point instruct the
into contract and non-contract producers. Contract farmer to produce less than the capacity the farm can
producers are broiler farmers who are contracted by an produce. It is on such cases that contracted farmers
integrator or contractor, the Swaziland Poultry Processors become less profitable than their potential.
(SPP). Contract farmers are those who produce for the
contractor and it is the duty of the contractor to market the Non-contract production process: Birds produced under
chickens produced. Non-contract farmers are those who the non-contract system of production mature from five to
produce and sell their birds on their own and they operate eight weeks. On average non-contract farmers pay an
freely in the market. They do not have a permanent amount E15.40 to raise one bird to maturity. The range of
market and their production is controlled by the available
raising a bird by non-contract farmers is from E13.50 to
demand of poultry in the surrounding markets. The major
E18.20. The difference between the ranges is brought
markets for non-contract farmers are restaurants, the
about by factors that include farmer's location, which
National Agricultural Marketing Board (Namboard), and
tends to increase transaction costs. Some farmers live far
butcheries. Non-contract farmers differ from contract
from the sources of inputs, therefore bringing the inputs
farmers in that contract farmers produce for SPP, while
to their farms raises the costs of the inputs. Non-contract
those contracted by Namboard are on quasi contract
farmers grow varying numbers of birds per batch thus
arrangement. SPP supply her contract farmers with
widening the range. After production the birds are sold as
production inputs and the farmers manage the birds to
live birds to consumers and some birds are sold to
maturity. After maturity the SPP collects all the chickens
retailers mostly restaurants.
from the farms and process them for further marketing.
Non-contract farmers have a stocking rate that ranges
Farmers only realize profits after the contractor has
from 200 to 22000 birds per batch. They produce less than
deducted the cost of inputs and transport. On the contrary,
contracted farmers because they have poor access to the
non-contract farmers produce the birds at their own
expense and buy all the production inputs and further formal markets. The only non-contract farmers to produce
have to find markets by themselves. five thousand birds upwards are the ones who have access
to permanent markets or have access to the formal market
Contract production process: For contract farmers the structures. In the Manzini region it is Valley Farm,
birds stay for a period of five to six weeks on the farm Njanja, and Mlondi Farm who have such privileges
before they proceed for processing. At this age the birds among the non-contract farmers. Valley Farm has
are matured enough to be consumed. To produce one bird, accessed the country's retail markets equally with SPP
it cost contract farmers E13.50 on average. The range for except that she can not compete with SPP in terms of
raising one broiler chicken by contract farmers is from quantities being sold. Njanja and Mlondi have vertically
E13.22 to E13.69. The range depends on the size of the integrated the supply chain for non-contract growers
batch. Farmers keeping more birds per batch have less through a quasi-contract with the Umbutfo Swaziland
cost per bird than farmers who keep fewer birds per batch Defense Force (USDF).
because of economies of scale. According to the results in Table 3, in the non-
Contract farmers are more productive as their contract system 17 farmers produce birds within the range
stocking rate per batch is high. They produce from 4800 of 200 to 1,000 birds per batch. The only non-contract
birds per batch to 100,000 birds per batch, but with more farmer who produces above ten thousand (10,000) birds
farmers producing within the range of 4000 to 8000 birds is Valley Farm who produces 22,000 birds per batch.
per batch (Table 2). The reason for this could be that the Valley farm is a well established abattoir at Sidvokodvo.
contractor requires that a farmer keeps a minimum of She produces and sells directly to the well established
5000 birds to qualify to be under contract production. markets in the country. She has also improved her
Some of the contract farmers produce from 52,000 products to be similar to those produced by the country's
broilers to 100,000 birds per batch. The contractor limits sole contractor (SPP).

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Feed merchants (crane, feeds,

feed master, and arrow feeds)

Chick breeder (national chicks)

Boiler farms

Contract Non-contract farmers

farmers (Live and processed birds)

Poultry
processor (SPP)

Distributers
(AD enterprices)

Super markets Caterers Individual Retail

retailers butcheries

Consumers

Fig. 1: Supply chain for broilers

Production efficiency of farmers: Non-contracted and dressed in preparation for consumption. The birds are
farmers are less efficient as compared to contracted processed into various products then packed before they
farmers. This is because contract farmers produce larger are sent to retailers for access by consumers.
birds in a short period of time than does non-contract
farmers. Contract farmers produce birds of 1.8 kg live The marketing side: Most non-contract farmers sell live
weight in five weeks whereas non-contract farmers birds direct to consumers. Birds sold on live weight basis
produce 1.3 kg live weight birds in the same period of to consumers are sold at an average price of E25.00 per
five weeks. This illustrates that contract farmers are more bird. It is only in special cases that some non-contract
productive and efficient compared to non-contract farmers who are vertically integrated in the industry
farmers. About 92.3% of contracted farmers produce process their birds before reaching the final consumers.
mature birds in five weeks. This means that contract Processed birds are then sold on weight basis per
farmers can produce more batches than non-contract kilogramme of a processed bird and is sold at E19.50 to
farmers since their birds are ready for the market at an retailers. However, non-contract farmers who process
earlier age than is for non-contract farmers. Contract their birds, sell them at an average price of E27.00.
farmers save on feed because their birds reach maturity at Contract farmers sell all their birds to their contractor
an early age. This therefore, means that farmers are saving who also serves as a processor. The birds are sold to the
on production costs for the birds as they only provide feed processor at E9.60 per kg of live weight. Upon arrival to
for five weeks. the processor the birds are weighed in order to establish
the payment to the farmer. The contractor then process the
The processing side: Some non-contract broiler farmers birds into various products as discussed in the processing
sell their broilers as live birds to consumers as illustrated side. At this stage the contractor is adding value to the
by Fig. 1 and other birds are sent to the processors for chickens, after which the contractor supplies wholesalers
processing. Most non-contracted farmers skip this stage and retailers with resultant products. Some retailers like
of the supply chain except for a few who have vertically SPAR, SCORE, KFC, and SHOPRITE buy the chicken
integrated the supply chain for non-contract farmers. The products directly from the processor, while the other
few non-contract farmers who process their birds follow retailers access the products from the processor’s
the supply chain illustrated by Fig. 1, but also sell others distributors, such as AD Enterprises. Individual customers
live. Within the processing stage the birds are slaughtered are not allowed to buy direct from SPP. They can only

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access meat products either from the wholesaler or from Dube, D., 1991. The Local Poultry Production and
the retailers. When purchasing from the wholesaler, Marketing Change. The Ministry of Agriculture and
consumers pay E20.99 for a kilogramme of a whole bird. Cooperatives, Mbabane, Swaziland.
Also the retailers who purchase from the wholesaler pay Freeman, H.J.N., 1997. Poultry and Egg Marketing in
the same amount as the other consumers. Swaziland. Ministry of Agriculture and Cooperatives,
Marketing Advisory Unit, Mbabane, Swaziland.
CONCLUSION Kunkel, P.L., S.T. Larison, P.A. Byers and S.T. Cloud,
2005. Agricultural Production Contracts. University
The study aim-ed at analysing the broiler supply of Minnesota Extension Services, Minnesota.
chain in Swaziland. Based on the findings of the study, Little, P.D. and M.J. Watts, 1994. Living Under Contract,
the following conclusions were derived. Contract Farming and Agrarian Transformation in
The non-contract system though with a minor Sub-Saharan Africa. University of Wisconsin Press,
recognition in the broiler supply chain, it does have an Madison Wisconsin, USA.
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Contract broiler farmers have a better financial Unpublished Research Project, University of
performance than non-contract farmers. Although non- Swaziland.
contract farmers get more returns from selling one bird, Masimula, J.M., 2004. Poultry Enterprise Budget and
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of scale in production per batch. The study has shown that Agricultural Marketing Board (NAMBOARD).
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linked production means that the structure, conduct and design. J. Operations Manage., 23(3-4): 371-388.
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Scott, C.D., 1984. Transnational corporations and
as improvements in the entire value-chain. There is also
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