Poultry Growers

The Details:
Farm Profiles & Sample Budgets from Established Poultry Producers

The following farm profiles can be used as guides to help you determine the profitability of poultry. In each of these examples, the farm produces fewer than 1,000 chickens per year, selling all of the birds directly to customers. At the bottom of this page, we have included sample budgets based on actual production costs and revenues from three small broiler production operations in different regions of Washington. We found that, as an add-on to an existing farming operation, a poultry enterprise is capable of contributing net income. However, at this level of production, poultry sales are not expected to provide more than 10 percent of the total annual farm income for any of these operations.

Farm A

This farm is located in San Juan County, Washington. A diversified, certified organic operation, they grow cane berries, strawberries, produce, and livestock as well as chickens. All products are sold at the local farmers market, direct from the farm, and through Community Supported Agriculture (CSA) sales. There is high demand for the total chicken production of approximately 400 birds per year.

The budget analysis for Farm A (below) represents a composite of four years of actual operations. The figures used to determine feed usage and labor hours are not estimates–instead these are drawn from actual production records. To raise the poultry, labor is supplied by unpaid family members but assigned a value roughly equal to the cost of hiring labor to perform the same duties. Processing is done on the farm with some hired labor. The equipment used for processing was purchased jointly by Farm A and another operation, and is now shared between them. This reduced the capital expenditure required for equipment used only intermittently during the growing season.

Farm B

Located in Southwest Washington, this farm produced approximately 1,000 birds in 2003. All processing was done on the farm with portable equipment leased to the farm operator and included as part of overhead expenses. Processing labor was a combination of unpaid farmer labor and paid help. There were no capital equipment expenses for this operation and the lease payment for use of processing equipment and production facilities was below market value.

Farm C

This farm is located in Northeast Washington and produced approximately 200 birds in 2004. Primarily a beef operation, Farm C tried pastured poultry production as a supplemental enterprise. Processing was done using the Mobile Poultry Processing Unit in Stevens County. A rental fee of $0.50 per bird is charged for the use of this unit, which is outfitted with all the equipment needed for efficient poultry processing. Labor for processing was a combination of unpaid farmer time plus hired labor.

Sample Budgets

A comparison of the data for each farm is summarized below in Table 1. Note that in all cases the majority of the labor costs are for “unpaid” labor for the farmer’s time spent raising and processing birds. All farms hired paid labor to assist with the processing. For Farm A the capital depreciation costs are high due to the inclusion of a new barn used for the poultry operation. The other farms had existing facilities that were fully depreciated or otherwise not included in the cost analysis. In all cases there was a positive return on a direct cash basis after expenses for the enterprise as well as a return for the producer’s labor.

    Farm A   Farm B   Farm C
Number of birds raised   418   1345   217
Total weight of birds (lb)   1977   6103   896
Average weight per bird (lb)   4.73   4.54   4.13
Price per pound   $3.75   $2.50   $3.00
Total Revenue   $7,414.28   $15,257.34   $2,688.63
Paid Cash Expenses
Chick purchase cost   $450.00   $1,616.16   $200.00
Feed costs   $2,267.85   $5,248.31   $709.20
Paid Labor costs   $0.00   $1,312.50   $308.40
Other variable costs   $128.00   $730.24   $878.76
Total Paid Cash Expenses   $2,845.85
  $8,907.21   $2,096.36
Net Cash Revenue   $4,568.43   $6,350.14   $592.28
Non Cash Expenses
Unpaid Labor Value   $3,337.60   $5,220.00   $1,040.00
Capital Depreciation   $2,296.80   $0.00   $47.98
Total Non Cash Expenses   $5,634.40
  $5,220.00   $1,087.98
Total Expenses   $8,480.25   $14,127.21   $3,184.33
Total Net Revenue   ($1,065.98)   $1,130.14   ($495.70)
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