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The Development of$Commercial Poultry Production I. Korea
Chong-Dae Kim
Livestock Experiment Station
Rural Development Administration
Omock Chun Dong Kwonsongu
Suwon Kyonggido, Korea, 1994-09-01

Abstract

The Korean poultry industry has developed rapidly over the past few decades. Since 1960, the consumption of meat and eggs has expanded tremendously. The commercial production of layers and broilers has resulted in bigger farms and automation to reduce production costs. In layer production, farmers began to establish cooperative farms after 1989, and succeeded in reducing costs. In broiler production, integration helped to reduce costs. Integration also helped to stabilize the supply of meat, and improve sanitation.

Abstracts in Other Languages: 中文(1461), 日本語(1252), 한국어(1445)

Introduction

The climate of Korea is a combination of the continental climate of central Asia and a marine tropical monsoon climate. The interaction of both weather patterns results in four distinct seasons. From late November to early March, the monsoon brings cold continental air and January is normally the coldest month of the year. During summer, warm and moist air originating from the tropical zone of the East China Sea, dominates the weather. From late June to July is the rainy season. During that time, the livestock industry has problem of hot temperatures and high humidity.

Consumption of meat and eggs in Korea has increased rapidly since 1960 ( Table 1(1467)). In 1965, the consumption of meat and the number of eggs per capita were 3.4 kg and 30, respectively, compared to 23.9 kg and 183 eggs in 1992.

Development of the Poultry Industry

Chickens have been raised for at least 2,000 years in Korea, but until 1900, they were raised in back yards for egg production.

From 1901-1940, breeds such as Barred Plymouth Rock, Nagoya Cochin and Single Comb White Leghorns were introduced from Japan. These imported breeds were reproduced by artificial hatching.

Between 1940 and 1960, as a result of World War II and the Korean War, the total number of chickens fell sharply. When peace returned, Single Comb White Leghorns, New Hampshires and Rhode Island Reds were introduced as part of the post-war rehabilitation programs. The period 1960-1980 was the time that commercial poultry farming in Korea developed and stabilized. The government strongly promoted the raising of small animals such as poultry and swine to meet the rising demand for animal products. The commercial broiler industry began after 1970.

From 1980 to the present day, poultry production has modernized, and there has been a change from full-time poultry farms to poultry factories. Specialization in hatching, rearing, egg grading and packing has taken place, and vertically and horizontally integrated systems have been established. Recently, pollution problems related to livestock, and a labor shortage as workers refused work with the `3Ds' (dirty, dangerous, difficult), has forced the automation of facilities.

Layer Industry

Of all types of animal production, it is poultry, and particularly layers, which show the fastest growth rate. After the Japanese period, the Livestock Division of the Agricultural Experiment Station in Suwon took charge of the improvement and distribution of breeding chickens. Unfortunately, the Korean war destroyed all the breeding stock. After the war, considerable amounts of breeding stock and eggs were provided by several foreign aid organizations. Thus, the number of chickens greatly increased even though management techniques were still at an early stage of development.

After 1963, Korea began to import commercial crosses and inbred breeders which provided layers with excellent performance. The success of the First Five-Year Economic Development Plan raised the GNP markedly, resulting in an increased demand for poultry products.

Up to 1960, chickens were reared in open barns located in the corner of the farmyard. Production in closed barns began in the early 1960's, when poultry farming began to be a full-time operation. The battery cage system was introduced into Korea in the mid 1960s. The first windowless barns were built in 1964 by several poultry farmers, but they failed because of the high cost of building and operating them.

The total number of poultry farms in 1955 was 1.12 million raising a total of 8.92 million chickens ( Table 2(1235)). At that time, the average number of birds per farm was only 7.9. Thereafter, the number of poultry farms kept increasing, up to 1.37 million in 1963. However, the number decreased to 1.17 million in 1970 and again to 1.09 million in 1975. At the same time, the number of chickens increased rapidly. The number of chickens per farm increased to 7.9 birds in 1955, 9.0 birds in 1965, and 19.1 birds in 1975.

After 1980, due to stagnant demand and over-production, small poultry farms gradually disappeared. The number of farms by flock size is shown in Table 3(1293). The popular size of poultry farm in the early 1980's was around 5,000 birds, because this was the optimum size managed by a farm family without automation. Eventually, competition to reduce production costs brought automation and bigger houses. The number of poultry farms raising more than 50,000 birds has increased almost four times over the past ten years. The total number of chickens raised on such farms also increased, from 3.13 million in 1981 to 12.91 million in 1992. The high production costs on small farms are demonstrated in Table 4(1170). The average cost of producing 10 kg of eggs on small farms was US$ 10.617, while costs on industrialized farms were US$0.997 lower. A large part of the production costs, including the price of chicks and feed, can be reduced through the enlargement of farm size. This situation promoted the development of cooperatives. Following the success of a single cooperative which began in 1989, the Rural Development Administration established a total of 20 cooperative poultry farms in 1993.

The main purpose of establishing cooperative farms was to improve productivity and reduce production costs by improved management. The principle of cooperative farms is to combine individual farms together and improve efficiency. Organizing farms into cooperatives brought about a 9.2% increase in their egg production, a 6% decrease in feed consumption, an 8% decrease in production costs, and an 85% increase in the number of birds managed per person ( Table 5(1158)). Cooperative farm management was 40% more efficient than individual farm management, mainly a result of improved laying performance, reduced mortality and lower management costs ( Table 6(1221)).

Cooperative farms can supply chickens for a price 9% lower than the general market price. They can also take advantage of the better sanitation possible on a larger farm, and use modern farm facilities.

Broiler Industry

The broiler industry in Korea has been commercially developed since the 1960's, when specialized broiler breeds and feedstuffs began to be imported. At this time there was also an increase in the demand for broiler meat.

During the 1970's, however, there was often an imbalance in the supply of broiler products compared to the demand. This resulted in fluctuating market prices for live birds, giving farmers unstable incomes. Due to the general nature of broiler production, farmers tend to place orders for chicks based on the current price for broilers, which makes the supply uncertain. These fluctuations were increased by the fact that dressing, distribution and supply to fast food outlets was not well organized. Prices for broilers could double in a month, or fall by half within a few weeks.

Because the number of farms is changing rapidly, it is not easy to show the number of broiler farms and birds. Table 7(1351) shows statistics taken in December. The number of farms gradually decreased, while small commercial broiler farms disappeared. Farms supplying broiler chicks became larger.

The production cost of broilers per 10 kg live weight was about US$11 ( Table 8(1187)). Chicks and feed were 19.2% and 55.7%, respectively, of total production costs. The broiler industry cooperated with hatcheries and the feed industry, as well as the processing industry.

Integrated Production in the Broiler Industry

The best way to survive in today's highly competitive environment is to lower production costs, increase productivity, improve the quality of products and develop consumer services. These needs naturally led to greater integration from the late 1980s. By 1992, a total of 16 integrated concerns had been established, producing more than 30% of Korea's total chicken meat According to a study of comparative cost efficiency, integration gave a price reduction of 32% for ready-to-eat chicken ( Table 9(1174)).

Other Branches of the Poultry Industry

Several poultry farms in Korea are raising Korean Native Chickens, or the Ogol Fowl. The Korean Native Chicken is believed to have been raised for almost 2,000 years. It is not easy to find pure lines, because most disappeared during World War II and the Korean War. The remainder were crossed with imported breeds. Recently, many researchers have tried to find the specific characters of this breed. The Ogol chicken is bred, not for quantity, but for quality. The native chicken grows very slowly and its egg production is poor. The price of its meat is almost five times higher than that of ordinary broilers. The Korean native chicken was not bred for meat purposes, but is adapted to backyard raising. The boom to raise this breed started after consumers began to look for good quality chicken meat.

The average body weight of the Korean Native Chicken at 14 weeks of age is 867.7 g ( Table 10(1170)). The eviscerated carcass yield at 9-14 weeks is 74.1-78.5% for males and 73.9-77.5% for females.

In terms of body chemical composition at 14 weeks, the crude protein of Korean native chickens was 25.03-26.36% in the breast and 21.65-21.85% in the thigh, which is a little higher than the crude protein content of broilers ( Table 11(1173)).

The Korea Ogol fowl typically has black feathers, beak, comb, legs, bone, skin, and meat. The meat is often eaten as a folk remedy, to improve people's health. Although the meat of this breed fetches a very good price, it is not yet very popular. However, raising these two native breeds might be suitable for farmers who have only a small land area and limited resources.

Source: Ministry of Agriculture, Forestry and Fisheries 1992
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Unit: US$
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Unit: US$

Index of Images

Table 1 Consumption of Meat and Eggs by Year

Table 1 Consumption of Meat and Eggs by Year

Table 2 Number and Size of Chicken Farms in Korea, 1955-1975

Table 2 Number and Size of Chicken Farms in Korea, 1955-1975

Table 3 Number of Layer Farms According to Size of Flock

Table 3 Number of Layer Farms According to Size of Flock

Table 4 Production Costs of 10 KG Eggs According to Farm Size, Korea 1992

 Table 4 Production Costs of 10 KG Eggs According to Farm Size, Korea 1992

Table 5 Efficiency of Cooperative Farm Management

Table 5 Efficiency of Cooperative Farm Management

Table 6 Relative Efficiency of Cooperative and Individual Farm Management

 Table 6 Relative Efficiency of Cooperative and Individual Farm Management

Table 7 Size of Broiler Farms and Flocks in Korea after 1980

Table 7 Size of Broiler Farms and Flocks in Korea after 1980

Table 8 Production Costs of Broilers Per 10 KG Live Weight in 1991

Table 8 Production Costs of Broilers Per 10 KG Live Weight in 1991

Table 9 Cost of Integrated Broiler Production Compared to Non-Integration

Table 9 Cost of Integrated Broiler Production Compared to Non-Integration

Table 10 Live Body and Carcass Weights of Korean Native Chicken

Table 10 Live Body and Carcass Weights of Korean Native Chicken

Table 11 Body Chemical Composition of the Korean Native Chicken

Table 11 Body Chemical Composition of the Korean Native Chicken

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