Analysis of production costs structure in broiler projects in the central region, Saudi Arabia

This paper analyzes production costs' structure and the relative importance of each cost item in broiler projects using a sample of 38 projects that make up 88% of the total number of broiler projects in the Central Region, Saudi Arabia in 1992. These projects were classified into three categories according to the final product: (1) live broiler projects: with 24 projects, (2) live and processed broiler projects: with 7 projects, and (3) processed broiler projects: with 7 projects. Results showed that the average total cost (ATC) for a live broiler is 5.72 Saudi Riyals (SR) broiler compared to SR 4.036/kg of live broiler. In live and processed broiler projects the ATC is SR 6.82/ broiler and 5.907 SR/kg, respectively. In proecessed broiler projects the ATC is 6.614 SR/broiler and 7.53 SR/kg. Results showed that the ATC decreases as production capacity increases confirming the concept of increasing returns to scale.