Poultry furnishes large nest egg for agriculture in Maryland

ON THE FARM

July 06, 2008|By TED SHELSBY

When President Herbert Hoover promised a chicken in every pot, he probably had some insight into the future of Maryland's poultry industry.

Maryland ranks eighth among states in broilers produced each year and 12th in total pounds of chicken production.

With sales of about $535 million in 2006, poultry production is by far the largest segment of Maryland agriculture. Sales of chickens account for about a third of farm sales in the state.

The industry's impact on the regional economy is huge. A Wicomico County economic development official once compared it with Disney World's financial contributions to Orlando, Fla.

The roots of the modern poultry industry can be traced to the early 1920s, a time when chicken was pretty much limited to Sunday dinner for the rich.

As the story goes, the Delmarva poultry industry grew out of a mistake by a clerk at a chicken supply house. The clerk sent a farmer 500 baby chicks for her egg hatchery instead of the 50 ordered.

At that time, eggs were the prime cash crop in the region. Even Perdue Farms Inc., the giant Salisbury-based chicken processor, started out as an egg supplier.

Instead of sending the chicks back, the farmer raised them for meat and sold them to a local buyer, who in turn found northern markets for them.

The success of this enterprise prompted other farmers throughout the Delmarva Peninsula to begin raising chickens for meat, according to an industry study by the University of Maryland.

Chicken farmers throughout the country got a big boost in business from World War II. Poultry, unlike red meat (beef, veal, pork and lamb) was not rationed during the war. As a result, production nearly tripled between 1940 and 1945.

Chicken still rules the roost of Delmarva agriculture, according to data compiled last month by the Delmarva Poultry Industry Inc., a trade association.

Last year, the four poultry companies operating in the Delmarva region, along with about 2,000 growers, produced 566.2 million chickens, roasters and Cornish hens.

While the number of birds produced was 0.3 percent less than in 2006, the amount of meat produced grew. These birds weighed 3.452 billion pounds, up 2.1 percent from the year before.

The industry attributes the increases in bird weights to improved genetics and improvements in feed, bird health, and in-house environmental practices.

To produce these chickens, farmers used nearly 77 million bushels of corn and the equivalent of 30 million bushels of soybeans.

The bulk of the corn and soybeans grown in Maryland is purchased by poultry producing companies and made into chicken feed.

The feed bill in 2007 was nearly $687 million.

According to DPI, the grain purchases by the chicken processors help keep local farmers in business, and this is an economic benefit to the peninsula.

Nearly 15,000 poultry company employees in Delmarva earned more than $386 million in salaries, while the 2,000 poultry growers were paid more than $180 million.

The Delmarva Poultry Industry points out that these are substantial dollars being circulated in a relatively small geographic area with a small population.

"Nearly every business on Delmarva is positively impacted by the chicken industry," said DPI president Wayne Evans. "The numbers are clear indicators of just how important the chicken industry is to the states in the region and they re-emphasize that keeping the poultry industry strong is good for all persons and government."

An important indicator of the strength and potential longevity of the chicken industry is the amount of money spent by growers and poultry companies on capital improvements, such as new facilities, renovations and new equipment.

The four poultry companies operating in the region spent nearly $70 million last year on improvements to their plants.

Growers spend an additional $65 million on building new chicken houses and upgrading many of the nearly 5,300 existing chicken houses.

The economic impact of these capital investments benefited other businesses, including builders, material suppliers, site preparation companies, financial institutions, electrical and computer contractors, and propane gas suppliers.

The value of the chickens raised on Delmarva last year was slightly less than $2 billion, the highest value ever.

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