POULTRY FACT SHEET NO. 19

COOPERATIVE EXTENSION

UNIVERSITY OF CALIFORNIA

February 1995

POINTS TO PONDER BEFORE STARTING A POULTRY OPERATION

Francine A. Bradley Extension Poultry Specialist University of California, Avian Sciences Department, Davis, CA 95616

What type of poultry do you want to raise?

You say you want to be a poultry producer. The term "poultry" encompasses any domesticated fowl raised for its meat and or eggs. In general, we consider chickens, ducks, geese, and turkeys to be poultry. Most commercial poultry operations raise only one species of poultry and raise it for a single purpose. That is, chickens to produce eggs for human consumption, chickens to produce fertile eggs for breeding purposes (chicken breeders), chicken for meat production, turkey breeders, meat turkeys, meat ducks, breeder ducks, and ducks for egg production.

What about the meat bird business?

Both the meat chicken and turkey meat industries are highly integrated. There are less than ten integrators in California. These companies own their own breeding stock, hatcheries, grow-out facilities (where the birds are placed after they hatch), and processing plants (where the birds are killed and prepared for sale). These companies have their own ranches to raise the birds they need. In some cases they may use "contract growers." A contract grower supplies the land, buildings, power, and labor for the grow-out facility. The integrator supplies the chicks, feed, and medications. The two have a contract guaranteeing the grower a certain amount per every bird raised to processing age. Integrators normally are only interested in contract growers located "conveniently close" to their centers of operation. These main geographic centers for meat bird production in California are Fresno, Kings, Tulare, Madera, Merced, Stanislaus, and Sonoma counties. Due to the pull-out of a major integrator and the reduction in production levels by other integrators, there has been a surplus of contract growers in the early 1990s.

Is there really a golden egg in the egg industry?

Producing eggs for human consumption is a business with a traditionally low margin of profit. Extension Poultry Specialist Don Bell is projecting that the average egg price to California ranchers will be 46.5 centers per dozen in 1995. Costs are anticipated to average 46.8 cents per dozen. While this looks like a dismal economic forecast, it should be noted that the California ranchers averaged a loss of around 4.0 cents per dozen in 1994.

You say you have a "pretty little spot" with room for birds?

Many people wish to combine their retirement with a supplemental agricultural enterprise. It is not surprising that retirees pick an attractive foothill or mountain spot for their retirement home. No matter how scenic this location, it may not be the best place for a poultry operation. Items to consider: where will you get your feed (and not just a bag at a time, but bulk delivery)? If you are raising meat birds, where will you have them processed? Is there a processing plant that does custom processing near your property? Of course, you can process your own birds and if you and your family members do ALL the work, you will be exempt from inspection. As soon as you hire a single person to assist with the processing, you are subject to inspection and must have a government-approved plant (an expensive addition to your operation).

What is the zoning?

Check with the government agency that has jurisdiction over your property to make sure that an agricultural operation is allowed. If so, you still are not guaranteed an easy time. A hearing may be required before you are allowed to start your business. While your neighbors may "enjoy" the kind of agricultural operations that involve trees, plants, and vines, they may have different views about animal agriculture.

Where is your market/Who are your customers?

There is no economic sense in producing a product unless someone is willing to pay the price that will allow you to realize a reasonable profit.

What is the volume of product your customers want and how often will they want it?

Do you have the size of operation that can produce a reasonable volume of product. Many buyers will not want to deal with producers who can only supply a small volume. If you plan to raise meat chickens for example, can you supply customers who will want weekly deliveries? It is recommended that different age groups be raised with as much separation as possible, i.e., different houses or barns. It will take 6-8 weeks for you to get your meat chicks to market age. If you plan to make weekly deliveries, do you have enough grow-out houses? Are you planning to sell at farmers' markets?

Is there a market close to you? Do they allow the sale of live birds? If you plan to sell processed poultry and eggs, is there a way for you to keep your product refrigerated while at the market?

How much "free" time do you need?

If you plan to maximize profits by having all the labor come from your own family, you must remember that birds need to be checked, fed, and watered daily. Eggs also need to be gathered frequently, processed, and refrigerated. Animal production can lead to a very restrictive lifestyle.

Do you have a financial net?

The cautious entrant into poultry production has arranged for some type of financial insurance. Often, one spouse will keep her/his outside job, while the other takes care of the birds. It is not wise to rely on a new poultry operation to be the sole support of any family. Unless, that is, the family has unlimited financial resources.

Additional Sources of Information:

California Federation of Farmers' Markets; P.O. Box 1533, Sacramento, CA 95812-1533; (916) 756-1695; will send a listing of farmers' markets to anyone who writes in with a request and encloses a stamped, self-addressed envelope.

County Agricultural Commissioner - consult your phone book's "Government Pages" under "County."

Egg and Poultry Quality Control, Calif. Dept. of Food and Agriculture (CDFA), 1220 N St., Sacramento, CA 95814; (916) 654-0800.

Marin County Farmers Market Assn., 1114 Irwin St., San Rafael, CA 94901; (800) 897-FARM.

Meat and Poultry Inspection, CDFA, 1220 N St., Sacramento, CA 95814; (916) 654-0504.

Pasadena Certified Farmers Markets, 363 East Villa St., Pasadena, CA 91101; (818) 449-0179.

Small Farm Center, UC Davis, Davis, CA 95616-8699; (916) 752-7779.

Southland Farmers' Market Assn., 1308 Factory Place, Box 68, Los Angeles, CA 90013; (213) 244-9190