CLEVELAND, Tenn. - Keeping more than 100,000 chickens warm and fed during this winter's subfreezing temperatures has been costly for chicken farmer Tommy Newman.
By the time the birds in his four chicken houses are captured Sunday night and shipped to Koch Foods for processing, Mr. Newman estimates he will have spent nearly $8,000 for propane and electricity over the past seven weeks.
"Chickens are the least profitable part of my farm, and if I could have gotten out of the chicken business I probably would have," said Mr. Newman, 47, chairman of the Southeast Tennessee Chicken Growers Association. "This was a pretty good business for many years. But it hasn't been worth much of anything for the farmer in the past couple of years."
Chicken farmers have faced cold weather and a bad economy since 2008 when Pilgrim's Pride - one of the largest chicken processors and one of Chattanooga's biggest employers with 1,500 workers in two plants - filed for bankruptcy.
But poultry still is the No. 1 agricultural industry in Georgia and soon could displace beef cattle as the most valuable agricultural product in Tennessee.
Ed Harlan, an agribusiness specialist for the Tennessee Department of Agriculture, said the planned opening of a $10 million hatchery in Lafayette, Tenn., by processor Cobb-Vantress could push poultry past beef.
"Tennessee borders the top 'Poultry Belt' states (Arkansas, Mississippi, Alabama, Georgia and North Carolina) and I think we can continue to see more growth in poultry over time," he said.
Last year, the industry was "hit with a perfect storm" of rising fuel and feed costs and lower demand, said Michael Lacy, head of the poultry science department at the University of Georgia.
Pilgrim's Pride shut down three sites, including its 280-employee processing plant in Dalton, Ga. Chicken farmers complained that processors also cut back on the number of birds they supply growers to raise for them.
But Pilgrim's Pride emerged from bankruptcy late last month when Brazilian giant JBS SA, one of the world's biggest meat companies, bought it for $800 million and assumed its debt.
"I think that will help not only Pilgrim's Pride and its growers but the whole industry," Mr. Harlan said. "It puts more stability into the industry."
hungry for chicken comeback
Chicken farmers are hoping for more than just stability these days, however.
David Chase farms 600 acres in Bradley County and said poultry growers are working for chicken feed.
"I made more money (in 1997) when I first grew chickens than I do now," he said. "I don't know how anybody who just spent $250,000 per chicken house can survive."
Larry Cunningham, chief lending officer for the Ag Credit cooperative in Chattanooga, said the current poultry market "is probably the worst I've seen it" in 33 years in the business.
But if exports and the economy continue to grow, chicken farmers should fare better in the future, he said. Over the past three decades, Americans have nearly doubled their per-capita consumption of chicken.
Dr. Lacy said the poultry industry has used genetics, nutrition and other management techniques to generate a pound of live chicken body weight for every 1.8 pounds of feed. That's nearly seven times better than the ratio for beef.
"The industry and universities have worked together to make both poultry meat and eggs one of the most efficient protein sources," Dr. Lacy said.
Poultry in Tennessee
Processing plants:
* Tyson: Union City, Shelbyville, Tenn.
* Pilgrim's Pride: Chattanooga
* Koch Foods: Chattanooga and Morristown
Breeder operations
* Hubbard: Pikeville
* Aigen: Crossville
* Cobb-Vantress under construction, Lafayette
Source: Tennessee Department of Agriculture