Contract Broiler Grower Returns: A Long-Term Assessment

Abstract

This study evaluates annual returns for a typical broiler house constructed in 1986 with a significant upgrade in technology in 1990. The results demonstrate the long-term nature of poultry house investments. This facility experienced minimal early return, but returns became much more substantial after debt repayment. Projected returns to the grower’s land, labor, and management during maximum debt repayment years ranged from approximately 3.0% of initial investment for a below average grower to nearly 11% for an above average grower. The models used in this study indicate that returns for broilers were consistently less variable and more positive than those for other selected agricultural products for the period evaluated. Broiler growers appear to have long-term returns equal to or greater than those of U.S. agricultural producers in general.