Tender Times Is sky falling on the chicken boom? Disquiet hits Shore's biggest industry

July 04, 1993|By Kim Clark | Kim Clark,Staff Writer

Bishopville -- When Jean Bunting was a little girl, helping her mother feed the chickens, it seemed the sky was the limit for the poultry business.

After all, her late mother, Cecile Steele, started this country's chicken-for-meat business in 1927 when she turned a mistaken order for 500 egg layers into a then- spectacular profit of $1,000 by trucking the birds to a New York butcher.

During the 1930s and 1940s, the money from ensuing flocks kept rolling in, buying new barns and paying for college educations for all the Steele children.

But now, after more than 40 years of raising broilers, Mrs. Bunting believes the sky may be starting to fall.

Today, she raises 65,000 chickens every seven weeks. But for every 5,000 chickens she sells, Mrs. Bunting is making less than what her mother made on her first flock of 500. The Buntings now have other jobs to pay their bills.

It is a story being echoed across the Delmarva Peninsula.

For six decades, the poultry industry here soared -- growing from the Steele family farm's 500 hens to the 548 million chickens produced last year by eight corporations with more 22,000 employees.

Now everyone, from growers to poultry-processing plant executives, is worried the end of the boom may be in sight.

After tripling in the past 50 years, Americans' average annual consumption of chicken hit 69 pounds last year, leading many in the industry to wonder whether people can stomach more.

"There is a lot of concern over how long this can keep going on . . . I don't think this is sustainable," says Allen Rahn, a Michigan State University agricultural economist who studies the poultry industry.

Although the number of chickens grown on the Eastern Shore continues to rise, some companies say a glutted market and sinking prices have forced them to cut operations or search for alternative products.

Prices for chicken have hit an all-time low in real terms. Today, a pound of chicken can be purchased for 4.5 minutes of an average worker's wage, down from 30 minutes in the 1940s.

Last year, ConAgra Inc. stopped sending chicks to 30 Delmarva growers to prevent an oversupply of chickens. Perdue Farms Inc. reduced its costs by cutting wages and then laying off some of its Salisbury-based chicken gatherers.

Several chicken companies have started to experiment with producing other kinds of meats -- from pork to striped bass -- to soften the impact of an end to the chicken boom.

All this could mean profound changes to the Eastern Shore, where the poultry industry is the bedrock of the economy and culture.

Eight processing companies -- Allen Family Foods Inc., Cargill Inc., ConAgra Inc., Hudson Foods Inc., Mountaire Farms of Delmarva Inc., Perdue Farms Inc., Townsends Inc. and Tyson Foods Inc. -- employ, directly or indirectly, nearly 1 of every 10 workers on the Shore.

Chicken culture

A drive through small Eastern Shore towns reveals a society built around chickens, not the windsurfing culture of the more well-known beach resorts.

A local machine shop boasts it built the world's largest fry pan for the annual chicken industry fry-off. Farmhouses are decorated by plaster chickens or have metal chicken weather vanes. Old stoneware chicken watering urns are even sold as decorative items in local antique shops.

The nation's $18 billion poultry industry is dominated by executives, such as Salisbury's Frank Perdue, who has spent millions to advertise himself as a "tough man" with a ruthless devotion to efficiency.

Now many on the Shore are afraid that an end to the growth will simply make an already lean and mean industry leaner. And meaner.

"Who put the paint on Delmarva? Poultry put the paint on Delmarva," the slogan went, and Edward H. Covell helped the paint go on.

Mr. Covell, who is now retired, headed what was the Shore's second-largest chicken processing company, Bayshore Foods Inc., in the 1960s and 1970s. He started his working life in a small grocery store during the Depression.

Bartering for eggs

Then, the vegetable farmers who had dominated the Shore's economy were failing because of the collapse of markets and prices.

"I know what it was like when there wasn't a lot of money," he recalls. "Women would bring eggs to town and would barter. I'd work up a credit for them so they could buy ham."

The revolution begun by Mrs. Bunting's mother started a dizzying race to produce bigger, better and cheaper chickens.

Growers found that reducing their prices -- even a fraction of a penny -- won them big sales increases.

Mr. Perdue and other growers prospered by eliminating middlemen, consolidating almost every step in the growth and delivery of chickens -- from processing the feed to packaging the meat.

They hired geneticists to cross-breed chickens and created a super-bird that grows to the standard 4 pounds in seven weeks and eats only 8 pounds of grain -- in one third of a natural bird's growing time and with half the feed.

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