The Cost of Local Chicken
A Chippewa Falls-raised certified organic chicken cost $5.39 a pound at Menomonie Market Food Co-op in early May. At the same time, an uncertified chicken raised in Pepin by Matt Buvala cost $4.99 a pound at Just Local Foods Co-op. Just Local also carries roasting chickens from Beaver Creek Ranch for $3.99 a pound. A whole, roasted, ready-to-eat chicken from a national chain grocery store might cost you only about $5 – total.
Where do these differences come from?
More than 90% of chicken farmers raise broiler birds on a contract basis through one of the four biggest chicken distributors in the United States: Tyson Foods, Pilgrim’s, Sanderson Farms, and Perdue Foods. These are the brands that distribute to chains all across the country for prices as low as $1.50 per pound.
When all is said and done, some chicken farmers are paid as little as $0.05 per pound of poultry, according to a 2014 article by NPR’s Dan Charles.
“The payment formula includes such factors as the number of birds, the amount of feed used, the performance of their flock compared to those raised by other contract farmers and the weight of the birds delivered to the processing plant,” the Tyson Foods website reads.
Contract farmers supply the land, labor, and infrastructure for raising chickens, while the distributor provides the birds, transportation, feed, and medication. Either party can exit a contract with notice. However, farmers often take on loans of a quarter-million dollars or more to start up a chicken house, leaving them dependent on every batch of birds from their business partner to make their payments. They’re dealing with millions of birds, which works out to hundreds of thousands of dollars, but when the cost of equipment, maintenance, and nature is accounted for, the margins can be slim.
Matt Buvala maintains a flock of about 300 laying pullets and raises 600 to 800 broiler chicks every year on 17 acres in Pepin. He’s 65 years old; three years younger than the average American farmer, according to the U.S. Department of Labor. He sells roasting chickens to Just Local in Eau Claire and eggs to Roadside Ice Cream and Diner.
“I’ve never operated at a positive,” Buvala said. He’s been farming since he retired from the Navy in 1999. “So I do it because I like to do it.”
Buvala has more freedom in how his chickens are raised than a contract farmer. His birds are not certified organic, but he free-ranges them, uses organic feeds, and refuses to give them growth hormones. With freedom comes risk; if something goes wrong with his flock, he bears the financial burden.
He estimates that between the cost of chicks, feed, bedding, grit, propane, and butchering, it costs him $11.29 to raise a roasting chicken to an ideal weight of 4.5 pounds. He sells them for $3.75 a pound, for an expected profit of $5.58 per bird. That doesn’t include mileage to buy feed or deliver the finished product. It doesn’t include the coolers he uses to ship the birds, which cost about $100 each. Equipment and infrastructure are constant investments.
It also assumes that all of the chickens make it to the market. Every bird that dies, every drop in temperature that requires more propane to heat the coop, takes a bite out of that number.
What Buvala does make, he puts back into his own community, and into the Chippewa Valley. He buys organic feed from Augusta, and local grit. He’s a member at Just Local Co-op. He does as much of his shopping as possible within the region, paying as much mind to who produced his food as he hopes people will when buying chicken.