Poultry Farm Profitability Fell 20 Per Cent in 2014-15, Survey Shows

ENGLAND, UK - Average poultry farm income fell 20 per cent in 2014/15, but this masks a more complicated picture within the sector, according to a report from the Farm Business Survey by Rural Business Research (RBR).
calendar icon 16 May 2016
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Closer analysis shows egg producers' income falling by 44 per cent to £35,551 per business whilst meat producers faced a fall of just under 10 per cent to an average £126,839.

This fall in incomes was despite increased consumer demand for poultry products in 2014-15 - UK egg consumption rose by 2 per cent and sales of poultry meat grew by 1.6 per cent. As a result the flocks in the survey continue to increase productivity, particularly poultry meat businesses where output increased by 4 per cent over the year.

There was little overall change in feed costs, which continue to account for an average 48 per cent of farm output. However on a per bird basis feed costs actually dropped by 4 per cent to an average £6.40 per bird, highlighting continued efficiency improvements across the sample.

Poultry farms have the lowest level of equity of all farm types in the survey at 71 per cent, with liabilities averaging £480,680 per business. Poultry is now a highly geared sector which has invested in response to market conditions, but unfortunately this also exposes these businesses to a certain level of financial vulnerability.

Egg producers 2 per cent decreases in average egg prices, but free range prices remained on average 9 per cent higher than more intensive units. Egg prices varied by about 10 per cent either side of the average, reflecting various arrangements with buyers including retail outlets.

On the poultry meat side, there was a 9 per cent increase in bird numbers, a 4 per cent increase in output and a 1 per cent increase in variable costs. Increases in labour, building and rent costs lowered overall farm income despite positive changes in output.

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