Annex 5

Swine raising contract - Thailand

At (Address)__________________

On (Date) ___________________

This contract is made between__________________ (Name), the authorized representative of __________________Co. Ltd., whose office is situated at __________________who will be called hereafter "the Employer" and (Name)__________________ , residing at __________________, village of __________________, Road_________, Sub-district________, District________,  Province, who will be called hereafter " the Contractor."

Both parties have entered into this contract on the Terms, specified below:

1. The Employer agrees to hire the Contractor and the Contractor also agrees to be hired to raise .... (number) piglets per batch. The Employer is responsible for providing the piglets, animal feed, drugs, vaccines and necessary materials needed for swine raising to the Contractor. The Contractor is responsible to provide swine housing to raise the piglets till maturity. The Employer may provide 10 percent plus or minus of the agreed number of piglets but will not be considered to be violating this contract so long as the difference is not more than .... (number) piglets.
2. The swine house shall be built in accordance with the specifications provided by the Employer. The house shall have sufficient water, and suitable environmental conditions and topography for swine fattening.
3. The Employer shall provide piglets weighing 15-20 kg., together with animal feed, drugs, vaccines and required materials, to the Contractor. The Employer shall weigh every piglet before delivering it to the Contractor. The Contractor shall carefully inspect all the items provided and acknowledge the receipt. The Contractor is required to keep the record of swine raising as well as the inventory of animal feed, drugs, vaccines and other materials in the forms approved by the Employer.
4. The Contractor shall provide efficient labourers for raising swine and cleaning swine housing and assist the Employer in the delivery of mature swine. The Employer or its representative shall give advice on the procedures to raise swine, including feeding, drug administration, vaccination and housing design. The Employer shall adhere strictly to this advice.
5. The Contractor agrees to facilitate inspection missions to be undertaken at any time by the Employer. The Contractor shall keep the records related to swine raising, including inventory of swine feed, drugs and vaccines, in a place ready for inspection. The Contractor shall deliver the used feed sacks to the Employer or its representative at the time prescribed by the Contractor.
6. The Contractor agrees to raise no other animals, e.g., elephants, horses, cattle, ducks, chickens, or swine from other sources, etc., that may carry disease, in the swine farm or at any place nearby in order to avoid any spread of disease.
7. If a piglet is sick, the Contractor shall immediately notify the Employer. If a piglet has died, the Contractor shall notify the Employer within 24 hours of death. The Contractor shall keep the carcass for the Employer or its representative to undertake an autopsy and certify the cause of death. If the Contractor fails to notify the Employer within the given time or has not kept the carcass for examination, the Employer shall assume that the swine is lost. In such case, the Contractor shall be liable, without any objection, for the fine and obligations in accordance with Item no. 10 under this contract.
8. When the swine weighs between 90 and 100 kg., the Employer shall fix the date for delivery. The Contractor shall facilitate the capture and means of transportation until the swine is effectively delivered to the Employer.
9. The Employer agrees to provide the following compensation to the Contractor:

   9.1 The Contractor shall receive Baht 1.5 per kg. of the increased weight against the original weight of the piglets. The final weight of fattened swine will be calculated based on the actual weight of fattened swine ready for delivery less the weight of the discarded swine and the original weight of the piglets.

   9.2 The Contractor shall receive a monetary incentive according to the Feed Conversion Ratio (FCR).

                   Total Weight of Feed Received - Total Weight of Feed Returned
   FCR =        _______________________________________________
   Total Weight of Swine Delivered

   [Details are then specified]

   9.3 If the combination of death rate and discard rate is lower than four percent, provided that the mature swine is in good health, the following incentive structure shall be applied:

   If the sum of death rate and discard rate is between 0.00-0.99 percent,
   Baht 900 will be given for the remaining swine.
   If the sum of death rate and discard rate is between 1.00-1.99 percent,
   Baht 700 will be given for the remaining swine.
   If the sum of death rate and discard rate is between 2.00-2.99 percent,
   Baht 500 will be given for the remaining swine.

   9.4 The conditions described under Item 9.3 above will be applied only if the death rate is lower than four percent. If the sum of death rate and discard rate is higher than four percent, the Contractor is not entitled to the incentive.

   9.5 If the fattened swine is sick or unhealthy or its body weight is less than 70 kg., the Employer will discard such swine.

10. During the fattening process, the Contractor agrees that the Employer may confiscate the swine in case of the following:
    

    10.1 If there is a loss in the number of swine without reasonable cause, the following fine structure will be applied:

    From 1 to 30 days after the start of the project, a fine of Baht 2 000 per swine
    From 31 to 60 days, a fine of Baht 3 000 per swine
    From 61 to 90 days, a fine of Baht 4 000 per swine
    From 91 to date of delivery, a fine of Baht 5 000 per swine

    10.2 If the feed is lost, a fine of Baht 500 per sack will be levied.

    10.3 If the record of feeding is lost, a fine of Baht 500 per document lost will be applied.

    10.4 If the swine die due to in-fighting, being killed by an other animal or by man or by an unknown cause, the Contractor agrees to be fined as follows:

    Weight of Fattening Swine x weight of dead swine - income earned from the sale of carcass

    The price of the fattened swine is the current announced price of the Employer.

    10.5 If the remaining swine feed is spoiled due to any causes resulting in fungus attack, wet granules, torn sack, etc., the Contractor agrees to be fined according to the prevailing price of the swine feed.

    The above fine is only for the damage incurred and the Employer still withholds the right to prosecute the Employer.

11. In fattening swine, the Contractor shall observe that the Feed Conversion Rate (FCR) is not higher than the standard appearing in the attachment to this contract. If the FCR is higher than 0.05 of the standard FCR, the following fine structure will be applied:

    The FCR rate is 0.06 higher than standard FCR, the fine of Baht 0.03 for every kilogram increased.

    The FCR rate is 0.07 higher than standard FCR, the fine of Baht 0.06 for every kilogram increased.

    [etc., etc.]

12. The Employer shall calculate the fine under this contract at the end of the unit batch cycle. The Contractor will receive the final wage after the deduction of any fines.
13. The Contractor shall return any unused swine feed, drugs, vaccine and feeding materials including the sacks to the Employer after each batch cycle. If the Contractor fails to return or can return only part, the Contractor shall be liable for the fine in accordance with the prevailing announcement of the Employer.

    If a sack of the feed is lost due to any cause, the Employer will be fined in accordance with the condition described under item 10.2, except in the case that the representative of the Employer has given a written justification of the cause.

14. This contract is effective from (date) until the time this contract is terminated.

    However, the Employer solely withholds the rights to terminate the contract. In case of termination, the Employer will give a one-month notice after each batch cycle.

15. In case the Contractor violates the Terms of this contract, the Employer has the right to terminate the contract without giving any advance notice. The Employer may ask the Contractor to pay the fines.

    This contract is made in duplicate with a copy retained by each party. Both the undersigned attest they thoroughly understand the terms of this contract in front of the witnesses.

    Signed______________	(The Employer)	Signed______________	(The Contractor)
    Signed______________	(The Witness)	Signed______________	(The Wife)
    Signed______________	(The Witness)	Signed______________	(The Witness)
    Signed______________	(The Witness)	Signed______________	(The Witness)

    
    
    
    

    Source: Betagro Northern Agro-Industry, Chiangmai, Thailand, 1999.