Egg targets save profit
PLUNGING profitability means achieving production targets and careful cost control is vital for both broiler and egg producers.
Sue Tucker, ADAS poultry team manager, said egg producers using their profitability index – where 100 indicates good, but not record breaking, technical efficiency and production – had seen April indices fall from 72 and 149 in 1997 to only 22 and 98 in 1998 for egg producers supplying packing stations and producer/packers, respectively. In the same period, broiler index values fell from 160 to 145.
"We have to keep a sharply focused eye on the strength of sterling. There are plenty of countries round the world with designs on our markets for poultrymeat and eggs, and their products are now cheap to import. The state of some Far Eastern countries and events like devaluation in Thailand and Malaysia have not helped. If it were not for this years low grain prices things could be worse." Producers should achieve target production costs for each dozen saleable eggs of kg saleable meat, which means maximising output and keeping tight control of costs.
"Cash control is king, with the top priority being meeting essential commitments. Control or delay capital expenditure until the business can afford it. Plan your financial strategy, and monitor each sector of the business carefully."
She also said communicating with both the bank and staff on the unit is important. "Keep them informed of developments."
Sue Tucker… Cash control is king, with the priority being to meet essential commitments.