Dairy Event 2009: Dairy producers branch out into poultry

Diversifying into growing broilers is an unlikely first choice of enterprise for dairy producers seeking extra income. But the Holloway family say it’s one of the best business decisions they have ever made.

“We’ve found the two enterprises to be highly complementary, the broilers are currently more profitable than the cows, and we enjoy what we’re doing,” says Chris Holloway. “Growing broilers is more straightforward, it provides a steady and reliable cash flow, management is computer controlled – therefore, its not hugely labour intensive – and, providing strict biosecurity is adhered to, staff can work between the two enterprises at peak times. In fact we have such confidence in demand for homegrown poultrymeat that we’re planning to expand the unit’s throughput by 60% to 200,000 birds a cycle.”

The Holloways manage an essentially family unit. Chris, Trish and their daughters, Elaine and Phillippa work full time at The Hayes, Merrington, Bomere Heath, a 216ha (535-acre) mix of owner occupied and rented grassland. The family has traditionally pursued a high-input,:high-output strategy and the dairy herd, managed by Elaine, reflects that approach. The 300-cow commercial black-and-white herd averages 9027 litres on three-times-a-day milking with a margin over purchased feed of £1799 a cow and £3266/ha.

In the mid-1990s, Chris and Trish began to explore new ventures. “We had paid off the farm mortgage and wanted to introduce another income stream,” he says “We considered buying another farm and doubling cow numbers, but we did not want to put all our eggs in one basket. Returns on dairy expansion did not stack up, milk prices were falling and we farm very heavy clay, which is totally unsuited to cropping.

“Our farm consultant, Andrew Snodgrass, advised us to diversify into broilers, and at the time a large processor happened to be offering an attractive 10% contribution to new shed build.” The Holloways invested just under £1m over 10 years in three 300ft x 80ft sheds accommodating an “average”-size broiler enterprise.

The system accommodates 120,000 birds delivered as day-olds and reared to an average 3kg in 50 days. The first thin of pullets is made at 2.1kg and 42 days, leaving the cockerels to grow on to heavier weights. A total 350t of bird is produced per cycle and FCR averages 1.7:1. Once the sheds have been cleared, they are cleaned out, power washed, disinfected and rested for seven days, bringing the cycle to 60 days. Chicken litter is delivered to a neighbouring farmer and swapped for straw.

“The enterprise is purely performance driven,” says Phillippa, who manages the unit with Mark Davies. “We’re working on a three-crop contract with Vion, which pays us 21 days after the end of each cycle on total volume of bird produced, minus the day-old chicks and total feed cost.

“Growing broilers in short cycles is far more simple than dairying spread over relatively lengthy lifetimes, and the shed’s computer controlled temperature and humidity almost eliminates risk from external factors. Also the birds require less labour, an average 0.75 labour units a shed.”

The broiler unit does have its own peculiar requirements to adhere to. “We have already destocked from 21 birds per sq m to 17 birds per sq m to meet with the EC Chicken Assured Directive, we’re compliant with the Integrated Pollution Prevention Control (IPPC) requirements, yet we’re lumbered with the £2500 annual charge, and we have to work with the Environmental Agency’s requirements.”

Looking to the future, while the dairy herd remains a firm fixture at The Hayes, the Holloways have placed greater faith in the broiler enterprise. “The processors are keen to reduce chicken imports and achieve a secure domestic supply, changes to current labelling could halt a certain volume of imports and there is an inexorable increase in consumer demand for chicken,” says Phillippa, adding: “We are planning two new sheds. Planning preparation and applications will cost £30,000 alone, but the returns are as guaranteed as we could expect for any farming enterprise.”

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