I have mentioned that prices will be going up this year, so here is our pricing update for 2018. Some of the good news: Lamb prices are not changing at all. Egg prices are going up just slightly. And though chicken prices are going up, I will hold the 2017 prices on our stock from last year until they are sold out. So come on out and buy some chicken from our freezers, until the new stock is processed in May. OH, and CSA members - your prices are staying the same for 2018, but will be adjusted a bit in 2019.
But before I post the price list for the year, let's talk about why. Many years ago, I did a study on egg prices, based on my expenses. Folks, I'm not getting rich selling eggs. And we ran at a loss last year, so I thought it was time to do the math again on meat birds. Yup... just barely squeaking by. I did not take good records of losses last year - bird fatalities or unsellable product, so I imagine we ran a loss this past year. Prices for feed had snuck up on me, not a drastic change, but enough over the years that my prices hadn't kept up. OH for the days of selling chicken at $2.50/lb!
So let's look at the math!
OK, so let's look at raising 100 meat birds
So they typically go through about 30 lbs of food in their life span, per bird. For an organic bird, our feed was $0.482/lb, conventionals were $.255/lb.
So to feed 1 bird for its life cost:
Organics: $14.46
Conventional: $7.65
At average finished weights of 3.5 lbs, the sale price per bird averages:
Organic: $24.50
Conventional: $14.00
OK, that looks like decent profit. But there is also the cost of purchasing the bird (averages $2.00/bird) plus processing costs, which I calculate around $1.00/bird for supplies alone).
OK, so that's $3 less of profit per bird. Now recall, the ONLY inputs I have included so far are feed, cost of the chick and cost of processing supplies. I did some rough calculations on electricity and water for this too, that takes away another $1.33 per bird. I included a potential 15% loss rate. That seems kind of high, but when you count the birds I can't sell because they have a wound on them (scratches from a predator or from each other, an injured wing or leg) or actual fatalities due to predator attacks, illness or injury, we do lose some birds. When I put all that together...
So my profit for each chicken is:
Organic: $4.66 (19%)
Conventional: $1.38 (9.8%)
Those profit margins would get me fired at my day job. This is looking at pocketing $138 dollars for raising 100 conventional chickens for 8 weeks. That in no way includes any of my time. Even if I spend 10 minutes a day ensuring they are fed or watered, That means I get paid less then $2.50 a day to take care of these chickens. WHAT?
So my prices are going up. Here is the basics of what we are looking at.
Organic birds will be $8/lb, conventional birds will be $5/lb.
That seems like a big price hike for my customers. And you know what that means for me?
I get paid $7.50 a day to take care of my chickens, OY! I think I will enjoy my pay raise! OK, that was snarky. I am in no way trying to trivialize this price increase, I understand it makes it more difficult for my customers to afford my products. I also recognize I will likely sell less meat this coming year and we are already adjusting for that. My point here is that this is not a money making venture for us, and folks expect cheap meat, because they can get it at the store. Small-scale, humanely raised chicken is not cheap. And for me to continue doing it, I need to be able to have cash flow to support it, cash flow to maintain the farm and the equipment we use to run it (which was not included in these calculations.)
So here is what I am going to work on this spring to try and alleviate some of the expenses. First, I am getting my chickens from a Colorado breeder. I did a batch last year and really liked them. Being hatched at altitude, they were acclimated already, and they seemed stout and hardy. I expect to see less losses on these guys. Second, I am going to start working on some feed changes. Namely, sprouting and fermenting. Sprouting the seeds, instead of just feeding the seeds, provides more nutrition, and good greens for the birds. This should be fun. Fermenting also increases the nutritional value of the feed, and what I hear - not only leaves less waste ( the birds desire it more, so they don't leave it hanging around on the ground) and supposedly thieves like mice and wild birds don't like it as much and will leave it alone.
So we will see what this year brings. Last year was an overall loss, and I wasn't expecting it. I need to be able to turn that around this coming year.