The Real Cost of Contract Poultry Farming (The Chicken Switcheroo)
Part of Taking Hold Of Poultry Cost Control: A cautionary (yet true) tale of commercial sleight-of-hand and psychological skulduggery perpetrated by pen and paper
Look at the next 3 images…
(Then I have a question for you…)
Now, here it is…
What do you call a card magician who removes a man’s watch without him knowing?
Answer…
A thief.
“You’ve been hit by…you’ve been struck by…”
(…that’s right…)
The art of distraction.
Using one thing as a cloak to get another.
Pick-pockets have been doing this for centuries.
The difference now is, pick-pockets use contracts, not cards…
…and take inheritances, not watches.
But game ain’t changed.
The Modern Poultry Pickpockets
1. Under Contract Farmers and the Fine Print
The length of this video is 1hr: 3mins: 34 seconds…
But I charge you…
…if you have any seriousness at all about running a poultry farm, then watching this is non-negotiable.
This single piece of journalism just might save you decades of disappointment and peril.
(Well worth the hour if you ask me…)
The Highlights:
The Contract Farmer’s Grind
Sold as a promise of a steady paycheck.
A solution for accelerated mortgage repayment & neat retirement.
But in reality, it couldn’t be further from the truth.
Steps:
A loan for over £1million+
Secured against farm and home
The stress of lottery-like ‘tournament’ for keeping farmers powerless & highly strung
Then a slew of expensive upgrades as mandatory i.e. extending the original loan (deferring them paying it off)
Spiralling debt unto bankruptcy.
Some quick economics:
$2 per pound of chicken meat
5 cents to the farmer (& even that is scrapped for)
2.5% commission (at best)
The farmer in the video above likened this to “throwing scraps out to 9 dogs, but there’s not enough even for the 9 dogs.”
Provoking farmers to fight against and undermind one another in a zero-sum dog fight.
(I suppose, if they’re divided, they can’t unite against the integrator. They continue to remain powerless and further, work against each other.)
The Tournament Lottery Explained
Farmers who receive chicks in the same week, compete against each other to generate the best performance, at the lowest cost.
i.e. the tournament
Think - Mad Max, Gladiator - a brutal spectacle for the elite to watch the disadvantaged devour each other for sport.
But how?
A psychological slight of hand that places the ‘blame’ for the variableness of the integrator’s pay check on each farmer’s comparative, competitive performance.
Such subtlety not only works to absolve the integrator of any comeback when the numbers don’t add up…
…but also tempts farmers, by injecting a little mutual strivance and 1-up-manship.
By doing so, the integrator works to divide the potential of unity among their contracted partners.
Diluting their power of a unified front for challenge, counters and re-negotiation.
And now,
Some details you should be aware of about the tournament system:
6 week rearing cycles (the amount of time birds are reared from day 1 to being due for market)
The integrator weighs the birds
The integrator determines the price it will sell a pound of chicken
The integrator determines the direct cost of raising the broiler e.g. cost of chicks, feed and medication
A ‘settlement cost’ for each farmer is calculated by the integrator as the total value of all chicken raised that cycle by a particular farmer, minus the ‘direct costs’
Base pay determined by (…yep, you’ve guessed it…) the integrator: this is calculated as the average of all ‘settlement costs’ across all contracted farmers for that integrator (*the contracted farmer that scores the average is paid this base pay, whilst the other farmers are paid either above or below this base pay)
A manipulative process that ultimately leaves the farmers ‘in the dark’ about the most critical aspect of the entire contracted arrangement…
…getting paid.
Thus,
The tournament LOTTERY.
Pledge a ‘pound of flesh’
Throw it all to chance
Those who win, fill their pockets with their neighbours’ living
Those who lose, are fleeced and left to stew, envying the winners and lusting after the image of recouping losses by winning big in the next round!
The risks get bigger, addiction stronger and frustrations hotter - a self-destructive cycle
The very definition of:
MISERY.
(And talking of misery…)
2. 'It's a miserable business,' says longtime Robeson County chicken farmer
Only 4mins: 35seconds this time - but still a weighty and sobering conclusion to this story and compliment to the documentary above.
Some points & quotes to observe:
Notice how each
farmervictim in the video above already had a successful family farm (…& then, came along a shiny suit offering to rub a little ‘green’ their way to solve all those problems that they actually never had & and of course, at no risk)“We’ll grow together, we’ll profit together.” - (again, who said the farmer wasn’t already growing, or profiting - in fact, who invited this guy?!)
Promised them a plain sailing send-off into retirement with a family-centred lifestyle to go with it (when in fact this significantly delayed and in some cases totally derailed their long-term financial goals and threatened to destroy marriages and households, if not for the faith of the humble farmer and his family)
Getting out of debt is the carrot that was dangled before their eyes (…only a trickster could get someone bound into the thing that their telling them they’re gonna be free of. A magician. Illusionist. Confusionist.)
7 years debt repayment, turned into 25 years & counting (…they agreed one thing, but at the time of payment, their wages were changed on them countless times)
“New contracts…that’s when things start going south.” - once bound in their circle, the wolves close-in to devour the sheep
“Everything is controlled by [the integrator]…you don’t have no say on anything - or they don’t bring you chickens.” - held to ransom by threats.
“Not a healthy business to be in because you’re stressed out the whole time them birds are here, & then you’re stressed after they leave because they’re holding over your head whether you’re going to get chickens back.” - total violation of a farmer’s peace of mind and sanity.
“I always said you can control a man by - a debt or a sword…and at this time, I’ll take the sword, it’s quick and painless.” - extortion is unforgettably cruel.
A ten-year loan (farm credit), turned into 30 years until paid off.
“I was a top producer for [the integrator] for 20-30 years…” - win or lose, the
contractgamble doesn’t actually pay off.“It’s a miserable business.” - I couldn’t say it better, my man.
And so,
Be charged:
Resist such deals at all costs (don’t let them in).
Because the price is:
Blood.
But what can be done about it?
Listen back to the words spoken by the legal professional in the 1st video:
“These big companies have so much [legal] power.”
They do indeed.
And really, the courts can’t touch them.
But interestingly enough, it’s not because integrators have so much money or political influence…
…it’s actually because the big companies (integrators) despite the havoc they wreak in people’s lives are actually RIGHT BY LAW…
“Why?!”…
…simply, the contract was WILLINGLY signed by each farmer.
The farmers gave away their power at the deal table.
Signed away with a pen.
No-one forced them.
So, effectively, it’s not actually a crime if the victim complied and had agreement with the assailant.
Again, the farmer gave it away.
You can’t then blame the government…it wasn’t their fault.
You can’t blame the legal system…it wasn’t their fault.
You can only therefore blame ignorance.
That’s the true crime (by which we are all tempted).
But remove ignorance…
…and we resist temptation.
In fact, temptation flees.
And this is therefore where farmers need to arm themselves:
With wisdom.
To raise their commercial, financial and investment acumen, so they cannot be deceived.
Therefore maintaining their assets and the true price of their labour - for generations.
The alternative (as evident above),
Is ruin:
The farmer who took legal action (and failed) in the 1st video summed it up,
“I had a life insurance policy that would pay off all my debts…”
Driven to despair.
Blood.
(Again, if not for the faith of the farmer and his family to value the keeping of their lives above their losses.)
So, one to remember…
How do you get an heir to hand over all that he has?
Overtly threaten him?
No…he’s too strong for that.
Bind him first (weakened by agreement).
(Then, his inheritance is all yours.)
Forbid the thought.
Yet this is what integrators have adopted.
Clothing themselves as financial saviours…
..but once a farmer walks through the door…
“Hey! Who put the lights out??!!”
Stay free.
Speak soon,
Temi
P.s. The University of Georgia, as quoted by The Poultry Site says, “It is virtually impossible to be in the broiler production business today without contracting with a poultry integrator.” - well, so THEY may say…but I KNOW a different way…