Poultry panel discusses cooperation

CEW-MR-1-Poultry panel5by Tamara Scully

Cornell Cooperative Extension recently presented a poultry marketing meeting, which addressed whether pastured poultry producers may best be served through some form of cooperative system: for marketing; processing; purchasing inputs; or even frozen product storage space.

CCE of St. Lawrence County has obtained a grant, from the Northeast Center for Risk Management Education, to study the production of chicken in hoop houses, in an effort to scale-up poultry production in Northern New York State. Betsy Hodge, CCE Livestock Educator, is involved with the project, along with extension agent Brent Buchanan.

“The general idea is to see if people who are raising a few chickens for themselves could expand to produce 250 chickens at once and make some money,” Hodge said. The idea is to create “a supply of high quality, consistent poultry for local, rapidly-expanding markets.”

The hoop house project, which began in the summer of 2013, is ongoing for one year. Four hoop houses, including one at the Extension Learning Farm in Canton, are being utilized in the study, which involves raising the birds to processing size over an eight-week period. The hoop houses will travel from site to site, to allow several producers to take part in the project. Producers must follow the established protocols, keep detailed records, provide adequate predator protection, and cooperate with the purchasing of feed and needed inputs.

“We want to collect data about growth rates, conversion from live weight to carcass weight, feed costs, chick costs, processing costs and types, marketing, labor required,” and more, Hodge said. After one more batch is raised this spring, the report will be finalized.

Each of four identical 12 foot by 24 foot hoop houses contains 250 birds. The project will rotate three or four groups through each house within one year. The hoop houses are kept stationary on the pasture, but fencing is moved regularly to keep the chickens on fresh pasture. The feeder is moved around to assist with keeping the chickens from denuding any pasture area. They have not had any problems with bare ground or mud, Hodge said.

Cooperation

The hoop house project has demonstrated that processing, storage and marketing of the poultry is challenging. The panel, which discussed several options for marketing the product, grew out of the challenges faced by the researchers. Direct-to-consumer sales, sales to other growers to supplement their own farm’s production, and sales using a cooperative as an intermediary were made thus far as a result of the hoop house project.

After processing, the poultry is kept in frozen until sold, so access to adequate freezer storage was a necessity. Bird size and quantity available for sale at any given time was a concern. These issues may limit the ability of an individual producer to scale-up their poultry production, and the exploration of options has become another focus of the project.

Lynda Brushett, of the Cooperative Development Institute, was on the panel to address the various forms of cooperatives which can be formed. An informal cooperative involves producers agreeing to work together in some way. There is no liability protection in this arrangement. Brushett advises having a written agreement and some procedures or structure in place.

There are “benefits of being formally organized,” Brushett said. A legal cooperative “is a business entity. It is an actual business.” Formed to “do business at cost,” a formal cooperative does not make a profit. “The purpose of a cooperative is not to make a profit. The farms are trying to make a profit,” she explained.

Should a formal cooperative make a profit, the money can be distributed back to the farmers, or the members can decide to use the money to for the cooperative’s operations. Importantly, all members of a cooperative have one vote, no matter their size. Farmers “form cooperatives to get things they can’t get so well themselves,” Brushett said. This can include equipment, feed, facilities, labor or marketing.

Sue Rau, manager of the North Country Grown Cooperative, was engaged to assist with the marketing of the poultry raised in the Extension hoop houses. Marketing the chickens was not going as smoothly as planned, and a facilitator was needed. NCGC set out to determine what, exactly, buyers wanted.

The three main demands: “quality, consistency, and price,” Rau said. “You have to have what you say you are going to have. Customers have to be able to buy at the price you need.”

“We take a little less per pound, so they could put their margins on,” Hodge explained. The price reduction was well worth it in order to obtain marketing assistance.

One issue was the need to stagger slaughter, so not all the birds are processed at one time, Rau said. Infrastructure for storing the poultry was needed from the beginning. Record keeping, including the origin and the weight of every bird slaughtered was important both for traceability and for producer compensation. Customers want to know how and where the chicken was raised.

Hoop house results

“It’s tricky to try to fill your orders by yourself sometimes,” Hodge said. For example “we were so surprised when Sue (Rau) came back and said the buyers want a certain size bird.”

Hodge did not expect that buyers would only want birds of a certain weight. Trying to get all birds in the flock to reach that weight simultaneously is not feasible. A group of producers could work in conjunction, in order to have enough birds of the specified size at the needed time. When marketing to institutions, size is important. This differs from a direct-sale to the consumer, such as at farmers’ markets, when some people will want large birds, and others very small birds depending on family size.

Factors such as cold weather can also impact size, as the birds will eat more feed in the cold, but won’t put on weight as they are using the energy to keep warm. Bird loss due to predators, weather or illness can also be moderated when producers cooperate to fill orders, Hodge said. The project has yielded other surprises, such as the hidden and significant costs of transport and storage. Keeping inventory and records was also more complex than realized, and time-consuming.

The panel also included Renee Smith, manager of North Country Pastured LLC. NCP is operating a mobile poultry processing unit, which is inspected by the USDA and is the first in the country. The unit has been licensed for operation since September 2013, and has processed poultry for the hoop house project.

The hoop house project experience and results will serve to assist producers with best practices for scaling-up poultry production. The hope is that the results of the hoop house project will decrease some of the risk in marketing poultry to local wholesale markets, and encourage northern New York State producers to expand their poultry production.

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