The Pullet Surprise: Sanderson Farms Hosts Contract Producer Meeting

The Pullet Surprise: Sanderson Farms Hosts Contract Producer Meeting

By Will Johnson 

Messenger Reporter 

DSC_0007PALESTINE – The first steps of turning the City of Palestine into a poultry producing hub are being taken. In February of this year, it was announced Sanderson Farms, the third largest poultry producer in the United States, would be locating a poultry complex in and around the Palestine area. Last month, Anderson County and City of Palestine officials approved abatements for the chicken giant.

On Thursday evening, May 2, representatives from Sanderson Farms were in Palestine to discuss opportunities in becoming a contract poultry producer for the company. A packed house greeted the delegation from Sanderson at the Palestine Civic Center.

Leading off the presentation, Wendy Ellis, Executive Director of the Palestine Economic Development Corporation, welcomed the estimated crowd of nearly 500 and the Sanderson Farms representatives. In her opening remarks Ellis said Anderson County had a long history of agriculture production and “….in 2010, agriculture production was responsible for bringing $42 million to our economy. In Texas, the poultry industry is a $4 billion industry. It is the third largest commodity produced in Texas behind cow/calf operations and cotton production. We are looking forward to moving ahead with this process and tonight is a really important first step for us.”

After thanking those involved in the process of bringing Sanderson Farms to Palestine, Ellis turned the program over to Bob Billingsley, the Director of Development and Engineering for the corporation. Billingsley provided those in attendance with a corporate overview and financial summary of the company. He said, “Tonight we are going to introduce our company to you. We are going to go through the details of the project and we are going to talk about what the opportunities are to you as a contract producer. At the very end of the presentation we will have questions and answers. We will stay here as long as it takes to answer your questions.”

As he continued Billingsley said, “What we are going to do is show a video that will kind of give you a feel for who we are. We are not a perfect company, but we work awful hard to ensure that we are a good company in the communities we operate in. We bust our tails, everyday, to do things the right way.”

The video started off with an overview of how the company had grown over the years in processing, sales, stockholders’ equity and stock performance. The price per share of Sanderson Farms is hovering around the $62 / $63 mark. After the overview, the video moved into Palestine specific matters.

As the video presentation rolled on, it was revealed there will be three main operations in and around Palestine. The administration, hatchery and live haul operations will cost roughly $17 million dollars to complete. Once it is completed, it will create 72 hourly and 34 salaried jobs, with an estimated annual payroll of $4.1 million.

The second area of operation will be a feed mill located near the Oakwood area. Once it is completed, it will be capable of producing 16,000 tons of finished poultry feed per week. The estimated project cost for this area is $32 million and it will create an estimated 60 hourly and nine salaried positions, with an estimated annual payroll of $2.6 million.

The third area of operation will be a processing plant. This will consist of a 170,000 square foot facility situated on roughly 200 acres and will be capable of processing 1.25 million chickens per week. The estimated cost of the project will be $75 million and it will create 900 hourly and 75 salaried positions, with an estimated annual payroll of $21.7 million annually.

Once the video concluded, Billingsley said even though the company has grown into a major player in the poultry industry, “The core principles that were good when we were a little Purina Feed and Seed Store are those same principles and that same culture that made you good yesterday, will make you good today and make you good tomorrow as well.”

The next part of the presentation centered around poultry production and what Sanderson Farms is hoping to achieve. This part of the program was moderated by Randy Pettus, Director of Production for the company. Pettus told the audience Sanderson was hoping to create and enter into 100 contracts with area farmers for poultry production.

Pettus said there were three areas of production the company was bringing to the area. These are pullets, hens and broilers. He said the people who were interested in this type of operation would be independent contractors (growers)and not an employee or agent of Sanderson Farms. These growers would enter into contracts with Sanderson which spelled out the obligations of both parties.

Sanderson Farms would be obligated to provide the chicks, feed, shavings, poultry medication and technical instruction. The growers would be responsible for the housing and equipment, maintenance of the facilities, care of the flocks and utility costs.

The pullet farms would begin with Sanderson Farms placing day old chicks in the pullet facilities. In the Palestine area, they are hoping to establish 18 total houses, divided between six farms with three houses apiece. Growers would be responsible for the chicks for 22 weeks. At that time, the chicks would be moved to hen farms by Sanderson personnel.

The pullet building requirements would be 48 feet in width and 550 feet in length. They would require all weather road (paved) access and would house six lines of feeders and three line of drinkers. Cooling would be done by tunnel ventilation and heating would be handled by gas brooders.

As mentioned earlier, once the pullets reach 22 weeks of age they would be moved to hen farms. Sanderson is hoping to establish 48 hen houses in the area with 12 farms holding four houses each.

The houses would be 42 feet wide and 500 feet long. The flocks would be in production for approximately 40 weeks with an eight week break between flocks. The egg production, beginning at approximately 24 weeks, would be handled by mechanical collection means. There will be five lines of feeders and three lines of drinkers in each house. The egg racks, flats and transportation of eggs would be handled by Sanderson personnel.

The broiler farms Sanderson is hoping to establish would require 496 houses with four, six or eight houses per farm. The houses would be 46 feet wide by 600 feet long. Growers would raise the birds for roughly 62 days at which time Sanderson personnel would transport the flocks for processing.

Before moving to the question and answer session, Pettus provided a detailed breakdown of the financial potential for growers in all three areas. He said the earnings potential varied based on land ownership, financing and production. Pettus detailed an average net income for pullet growers of $42,092, hen growers of $99,318 and broilers of $73,020. For more information on becoming a poultry producer for Sanderson farms, Pettus urged people to contact Marty Flynt by phone at (601) 649-4030.

Will Johnson may be contacted via e-mail at wjohnson@messenger-news.com. Also, be sure and check out our newly revamped website at www.messenger-news and our just recently launched Facebook page.

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