Friday, March 29, 2019

Market Competitiveness In The Malaysian Poultry Supply Chain Economics Essay

Market Competitiveness In The Malayan Poultry Supply Chain Economics EssayThe structure of the Malaysian bird industry is different from the one that existed in the nineties, due gener all toldy to vertical coordination and integration. Independent and self-operated activities that once dominated the production system nonplus been replaced by contracts and outright ownership and operation of the production by integrators. By this many individual poultry shapeing companies own almost all aspects of production-breeding farms, propagation farms, hatcheries, feed mills, some broiler growing farms, and processing plants. The structure whence, see an aspect of integrated production-marketing systems which involves a single steady owning and operating every aspect of production from importing p bent stock to marketing incase chicken-meats in company owned outlets. For instance the ex-farm level has been dominated by the integrators because there be only four (4) companies meetl ing 100% shell out of the importation of the breeder birds. The four integrated companies are Ayamas breeder enkindle Sdn Bhd, CAB breeding Farm Sdn Bhd, Charoen Pokphand Farm sdn Bhd and Leong Hup Poultry Farm Sdn Bhd. thither are ninety two (92) Parent stock (multiplication) farms owned by twenty five (25) separate companies. According to DVS (2012) report ten (10) of these multiplication companies are owned and operated by integrators. There are fifty 3 (53) hatcheries in Peninsular Malaysia, thirty one or more than 58% of the hatcheries owned and operated by integrators. The total day-old chicks (DOC) production in 2011 by the industry was estimated at 653,006,812 million chicks, and the integrators contributed 70.75% of the total (DVS, 2011). The Department of Statistics (DOS) Malaysia report on the census of agricultural establishments shows there are only 292 poultry agriculture establishments registered in Malaysia as against more than 3,500 reported by DVS suggesting th at integrators are probable to owned and operate multiple farms and that a number of independent operated farms are not formally registered. Report from DVS, (2011) have shown that Malaysian broiler-chicken industry arrest 62.56% of the total chicken meat supply in the Peninsular Malaysia and non-integrators control 21.4% share of the supply.Problem statementAlthough the integrating production system allows the firm to achieve economies of scale, decrease transactions costs, as well as the baron to closely monitor product quality at every phase angle of production by controlling all inputs and processes at every level. However, on the other hand the traditional structure- take up-performance paradigm hypothesized that the level of concentration in a particular market will influence the degree of competition among firms in that market. Markets that are highly concentrated (few large firms dominating the market) are slight competitive than markets where concentration is low. As such, according to the hypothesis, firms in less competitive environment charge higher prices and reap monopolistic profits. A higher price above marginal cost implies inefficient tryst of resources and the resulting implication is production inefficiency. A concentrated industry structure could therefore weaken the efficiency and effectiveness of market performance. In view of this, the take on is aimed to evaluate the indicators of competition in the supply ambit of the Malaysian poultry industry.Objective of the StudyIn broad sense the objective of the conceive is to evaluate the indicators of competitiveness of the Malaysian poultry industry supply image specificallyTo assess the structure, conduct and market performance of the Malaysian poultry supply chainTo determine the strategic behaviours of the firms and relationship among supply chain participants of the industry.To describe the farm-retail-wholesale price spread along the supply chain to regain symmetry or otherwi se in the price transmission process within the industry as an indicator of price setter and taker suppositional Framework and MethodologyThe concept of S-C-P which emanated from industrial organization studies primarily to poll the competitive conditions in industries by examining how the industry structure relates to market conduct and its performance was explored in this study. The S-C-P framework postulates that as market structure deviates from the deification perfect competition, the extent of competitiveness of the market will decrease and then a decline in market efficiency (Scarborough and Kydd, 1992).The S-C-P Modeltightness Ratio classificationMarket structure CR4 CR8Highly concentrated 75-100 slightly concentrated 50-75 slightly concentrated 25-50 Atomistic 0-25

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