Pilgrim's Pride Chicken Farming: Getting Started

Pilgrim's Pride is one of the largest poultry processors in the United States, with more than seven decades of experience in the industry. The company has a significant presence in the chicken farming industry, with control over more than half of the country's chicken farms. Becoming a chicken farmer for Pilgrim's Pride typically involves entering into a contract with the company, where farmers provide the necessary infrastructure and labor to raise chicks supplied by the company to market weight. Farmers earn profits based on the weight gain of the birds, and the company provides support and opportunities for stable, year-round income. However, it is important to note that the poultry industry has faced criticism for its impact on farmers, with allegations of anti-competitive practices and the challenging financial situation that farmers may face due to the high costs of production and low prices.

Understand the business model: Pilgrim's Pride uses a vertical integration system where farmers provide buildings, utilities, and labor

Pilgrim's Pride is a vertically integrated company, meaning it controls all steps of the production process, from hatching to breeding, processing, and packaging. In this system, the company supplies chicks, feed, and medicine to farmers who provide the buildings, utilities, and labour to raise the chicks to market weight. Farmers earn a profit based on the birds' weight gain, usually a set rate per pound.

This business model allows Pilgrim's Pride to have a steady supply of chickens for processing and retail, as they can closely manage the supply chain. It also provides an opportunity for farmers to earn an income by raising chickens under contract with the company.

For example, Lloyd Phelps, a farmer in Union County, Arkansas, has been working with Pilgrim's Pride and previously with other companies since 1978. He has six chicken houses on his farm and has been able to turn over six flocks of 130,000 chicks each year.

However, this vertical integration system has also faced criticism and legal challenges. In 2024, Pilgrim's Pride was involved in a lawsuit representing over 24,000 poultry farmers, accusing the company of sharing confidential information about farmer payments and agreeing with competitors not to compete for growers, which is an anti-trust law violation. As a result, Pilgrim's Pride agreed to pay a settlement of $100 million to affected poultry farmers.

Despite these challenges, Pilgrim's Pride continues to be a major player in the poultry industry, supplying large retailers, food services, and restaurants with chicken products.

Location requirements: Ensure you meet location requirements for efficient feed delivery and confirm the need for additional farmers in your area

Pilgrim's Pride is a vertically integrated company, meaning it controls every process from "egg to table". The company supplies chicks, feed, and medicine to farmers, who in turn provide the buildings, utilities, and labor to raise the chicks to market weight. Farmers earn a profit based on the birds' weight gain.

To become a chicken farmer for Pilgrim's Pride, you must meet certain location requirements to ensure efficient feed delivery. The company operates in 12 states, including Arkansas, Texas, and Colorado, as well as Mexico and Puerto Rico. It is important to confirm that your location aligns with the company's operations and that there is a need for additional farmers in your area.

When considering the location requirements, it is essential to assess the proximity to feed suppliers and the efficiency of feed delivery. Pilgrim's Pride has a history in the feed business and supplies cattle feed to ranching operations in East Texas. Efficient feed delivery is crucial for the success of your chicken farm, as it ensures the consistent growth and health of your flock.

Additionally, you should evaluate the local market demand for chicken products. Pilgrim's Pride distributes its products primarily through foodservice and retail outlets. Understanding the local demand and supply dynamics can help you determine if there is a need for more chicken farmers in your region.

By meeting the location requirements and confirming the need for additional farmers in your area, you can ensure that your chicken farm is well-positioned to receive the necessary supplies and serve the local market effectively.

Farm infrastructure: Ensure your farm has the necessary infrastructure, including chicken housing, equipment, and technology for optimal growing conditions

To become a chicken farmer for Pilgrim's Pride, you will need to provide the buildings, utilities, and labour to raise the chicks to market weight. This means ensuring your farm has the necessary infrastructure, including chicken housing, equipment, and technology for optimal growing conditions.

There are two common types of poultry housing facilities: cage-housed operations and floor-housed operations. Cage-housed operations involve keeping birds in cages for egg production, while floor-housed operations are for meat production. Broilers (chickens used for meat) are typically produced in littered floor systems, where birds are kept in a closed structure with space to move around and access to feed and water systems.

When establishing a chicken house and its infrastructure, careful planning is required. You must consider factors such as driveways, loading areas, feed storage, work rooms, water supply, power and electrical systems, lighting, insulation, cooling, and ventilation. You should also ensure compliance with local planning rules and regulations.

To create optimal growing conditions, you can utilise various technologies. Advanced environmental control systems can regulate ventilation, temperature, and lighting within poultry houses, automatically adjusting conditions to ensure the comfort of the chickens. Precision feeding systems use automated feeders with sensors to deliver tailored nutrition to each bird, improving health and growth rates while minimising waste. Additionally, water recycling systems and renewable energy sources, such as solar panels, can contribute to sustainability and reduce the environmental impact of your farm.

Bird care and welfare: Adhere to strict standards for bird care, including daily health checks, growth tracking, and biosecurity measures to protect flock health

To adhere to strict standards for bird care, you must perform daily health checks, track the growth of your birds, and implement biosecurity measures to protect flock health.

Daily health checks are crucial as birds are adept at hiding illness, driven by their natural instinct to avoid appearing vulnerable in the wild. Thus, they may be sicker than they appear. Indicators of good health include bright and alert eyes, clear and dry nostrils, a strong beak with no overgrowth, fractures, or asymmetry, and a clean inside mouth with no foul odour. A high-quality, varied diet and a well-maintained environment are also key contributors to the overall health of your birds.

Regularly weighing your birds is an essential aspect of growth tracking. This can be done by weighing the bird in its cage after removing variables like water, seed, and waste, and then subtracting the weight of the cage. Alternatively, you can carefully place the bird in a small cloth bag or shoebox and weigh it.

Biosecurity refers to the collective measures taken to prevent diseases, viruses, bacteria, fungi, parasites, and other disease-causing microorganisms from infecting birds, property, and people. Structural biosecurity pertains to the physical construction and maintenance of coops, pens, and poultry houses, while operational biosecurity involves the consistent practices, procedures, and policies followed by everyone involved in raising poultry. To defend your flock, implement measures such as minimising visitors, ensuring everyone washes their hands before and after handling birds, providing disposable boot covers or disinfectant footbaths, and changing clothes before entering and exiting poultry areas.

Compensation and risks: Understand the compensation structure, which may be performance-based, and be aware of the financial risks associated with contract poultry growing

If you're considering becoming a chicken farmer for Pilgrim's Pride, it's important to understand the financial aspects and potential risks involved. Pilgrim's Pride has a system of contract poultry growing, where they supply chicks, feed, and medicine, while farmers provide the necessary infrastructure and labour to raise the chicks. Farmers' earnings are typically tied to the weight gain of the birds, earning them a certain amount per pound. This performance-based structure can be lucrative, but it also carries financial risks.

In the past, Pilgrim's Pride has faced financial troubles, filing for Chapter 11 bankruptcy in an effort to reorganise its debts. This had a significant impact on contract chicken farmers, who were caught between the company's struggles and their own financial obligations. The closing of processing plants resulted in job losses and disrupted the livelihoods of many growers.

To mitigate financial risks, it's essential to carefully review the terms of the Pilgrim's Pride Broiler Grower Contract. This contract outlines the rights and responsibilities of both the company and independent growers. It includes details on compensation, such as the base pay and adjustments based on performance and cost improvements. Understanding these terms can help farmers make informed decisions about their operations and manage their financial expectations.

Additionally, it's worth noting that Pilgrim's Pride has been involved in lawsuits regarding price-fixing and underpaying agriculture workers. The company settled these cases for a significant amount, indicating the importance of staying informed about legal developments that may impact your financial prospects. While the settlement provides some compensation to affected farmers, it also highlights the potential risks and uncertainties associated with contract poultry growing.

To summarise, becoming a chicken farmer for Pilgrim's Pride involves a performance-based compensation structure that can be financially rewarding. However, it's crucial to be aware of the financial risks, including the company's financial health, the stability of processing plants, and any legal or contractual factors that may impact your earnings. Careful consideration and a thorough understanding of the contract terms are essential before embarking on this endeavour.

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