Analysis of the Transfer Costs in Broiler Chicken Distribution from Bulacan to Wet Markets, 2025

Date

6-2025

Degree

Bachelor of Science in Agricultural Economics

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Christian Paul L. Fang

Committee Member

Geny F. Lapiña, Maria Angeles O. Catelo

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Abstract

Transportation plays a vital role in bridging the gap between areas of agricultural abundance and places of scarcity. Numerous studies have examined the supply and demand, market composition, and performance of broiler chicken. However, there remains a gap in the literature specifically analyzing the transfer costs incurred in its distribution, particularly from Bulacan to wet markets in Metro Manila.

This study aimed to analyze the transfer costs involved in the broiler chicken distribution network originating from Bulacan. A total of 72 respondents were interviewed using a forward tracing method. The study identified seven broiler chicken growers, 14 traders, one dressing plant manager, 15 dealer-processors, six retailer-processors, four wholesaler-retailers, and 24 retailers operating in Bulacan and Metro Manila. Both primary and secondary data were utilized. Descriptive analysis was employed to profile the respondents, while transfer cost analysis was conducted to estimate costs incurred. Fisher’s Exact Test was used to assess the association between transfer costs and the types of vehicles used, while Spearman’s Rank Correlation was applied to determine the correlation between transfer costs, distance traveled, and volume transported.

The results revealed five existing marketing channel types for broiler chicken distribution in Bulacan. Transfer costs were categorized into three components: (1) road and transfer costs, (2) loading and handling costs, and (3) other costs, which included illegal fees, depreciation, and opportunity costs. Among these, opportunity costs was found to have the highest contribution, followed by loading and handling costs. Transfer cost analysis showed that Channel 1 had the highest average explicit cost per kilogram, while Channel 2 had the lowest—largely due to differences in delivery distance (Quezon City vs. within Bulacan). In terms of total transfer costs, Channel 3 recorded the highest due to underutilized truck capacity, while Channel 5 had the lowest, benefiting from shorter distances and efficient truck utilization.

In terms of marketing efficiency, the distribution system was deemed efficient based on marketing margins but inefficient in terms of mortality rates and delivery timeliness. Fisher’s Exact Test indicated a significant association between transfer cost and the type of vehicle used. Spearman’s Rank Correlation showed no significant correlation between transfer cost and distance traveled, but a strong correlation with volume transported.

Based on the findings, the study recommended the following: implement a multiple transaction system at poultry farms, utilize ventilated transportation cages, expand market reach to optimize truck capacity, and construct live broiler storage facilities at drop-off markets. Future research should consider comparing distribution systems between integrators and independent broiler growers for a more comprehensive understanding.

Language

English

LC Subject

Broilers (Chickens), Supply and demand, Transfer pricing

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993.5 2025 A14 P48

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Document Type

Thesis

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