Poultry Production and Processing Economics.pptVIP

Poultry Production and Processing Economics Jeff May, Regional Manager, Dawes Laboratories Jeannette Beranger, ALBC Research Technical Program Manager First things first…. Define your mission I bet I can be the best marksman in the world. Same target same distance… My only condition is that he wear a blindfold. What kind of system will be used to raise the birds? Living Environment Indoors Enclosed yards Free range Pasture Feed All vegetable feed Organic Anti-biotic free Custom blend Calculating Operational Costs Primary expenses include: 1. Feed – Cost dependant on the feed prices and feed conversion of the birds. 2. Chicks – Cost dependant on species, breed, and numbers of chicks ordered. 3. Fuel – Cost dependant on heating needs for brooder and vehicle fuel prices. 4. Housing – Cost dependant on expenditures for set up clean up. Feed Conversions based on Good Shepherd Data Corn/Rock Cross 2 lbs of grain / lb of weight gain with 5-6 weeks of age for grow out Standard breed 4 lbs of grain / lb of weight gain with 14-16 weeks of age for grow out Processing Your flock size will be limited by the capacity of the processing plant. Product Pricing Don’t undercut the market. Familiarize yourself with current prices for comparable product on a regular basis. General Rule of Thumb for Setting Price Cost of production x 1.2 plus the cost of processing equals your total cost. Your cost plus ~20% equals the baseline price for the product. This price needs to be re-evaluated often as costs for various aspects of production can fluctuate as will the market price for comparable products. Value-added Considerations Advantages Can increase profit margin is some cases Can utilize product that may otherwise have little to no value Can diversify the farm’s offerings to the public Pitfalls May be difficult to have access to value-added processing The cost of the processing may be high The profit margin could be very low Food For Thought on Value-Adde