Growers’ Insights: Food Fight

The price to feed turkeys is going up, thanks in large part to government ethanol mandates.

Published in FSD Update

Turkeys consume a steady diet of corn and soy meal. The combination of last year’s drought and government mandates for corn crops to be used as ethanol to blend with gasoline have led to high feed prices that make growing livestock very expensive.

“Devastating isn’t a strong enough word for how we’ve been impacted by the feed shortage,” says fourth-generation turkey farmer John Burkel, director of Northern Pride Inc., a grower-owned turkey processing facility in Badger, Minn. Burkel and his wife, Joni, produce 180,000 hens a year for the Thanksgiving whole-bird market. 

Corn and soy meal feed represent 70% of Burkel’s operating costs, which translates to $5,000 a day for the daily ration of 15 tons of feed needed for his “small, mom-and-pop sized” operation. “Those are difficult checks to write,” adds Joni, but the Burkels count themselves blessed to have escaped bankruptcy—some of their fellow growers haven’t been as fortunate. “We’ll live with the feed shortage until next year’s crops come in,” John Burkel adds. 

Burkel begins growing day-old “poults”—baby turkeys delivered from a breeder—in February, until they mature in 12 to 14 weeks. Processing begins around the end of April. 

According to Keith M. Williams, vice president of communications and marketing for the National Turkey Federation, the current consumer price for fresh whole turkeys is $1.16 per pound, slightly lower than the $1.34 posted in November 2012 and $1.36 in December 2011. 

Increasing costs

Even though the price for consumers to purchase turkeys has decreased, Burkel says his costs continue to rise.

“Next year’s turkey prices could be higher, if our industry grows fewer turkeys, even if the feed prices drop,” Burkel says. “However, passing these costs along to the consumer is hard to do, and you’re competing with other companies.” That means growers like Burkel often have to absorb these costs to remain competitive.

Electricity costs have almost doubled during the last five years, says Burkel, who hopes to reduce his monthly bill 80% by switching to LED barn lighting. 

“But if you really want to get me fired up, we can talk about ethanol,” Burkel says. “That’s really the reason the price of meat has increased.” Because federal government regulations require that corn crops be blended with ethanol for gasoline, farmers have diverted resources into growing corn for fuel instead of food. That in turn has increased the feed price for growers like Burke.

The housing environment

Ron Kardel, president of K3 Co., in eastern Iowa, raises both Nicholas and Hybrid turkeys for luncheon meat. Kardel needs to feed his 170,000 turkeys for four or five weeks longer than a Thanksgiving hen and uses feed supplements including salt, amino acids, vitamins, enzymes and fat.

About 10,000 turkeys live in each of Kardel’s environmentally controlled buildings, in Walcott, Iowa. “The buildings have screens that are covered with a curtain-type material, which moves up and down to control the temperature inside,” Kardel says. “Heat comes on in the winter, and summer requires fans and a sprinkler cooling system.”

Like Kardel, Burkel also houses his turkeys indoors. “The last time I had turkeys outside was 1994,” Burkel says. “The weather suddenly changed and we lost a bunch of them. It was sad. Plus, we have wildlife pred-ators as well as skunks and raccoons,
that carry a lot of weird diseases, like cholera. Turkeys are much safer indoors.”

More From FoodService Director

Sponsored Content
coffee senior living

From Keurig Green Mountain.

Healthcare foodservice represents the perfect environment for serving coffee. For the time-crunched staff, family and friends visiting patients, and seniors craving a treat, snack, or pick-me-up, coffee is considered a valuable amenity.

What’s more, purchasing beverages away from home is a popular habit. According to Technomic’s 2016 Beverage report, consumers average 3.6 drink purchases per week from foodservice outlets. And coffee is one of the most popular beverage options— Technomic’s 2016 Snacking Occasion report found 61% of consumers say...

Industry News & Opinion

South Valley Preparatory School in Albuquerque, N.M., has launched a range of healthy eating initiatives to combat obesity, the Albuquerque Journal reports.

The initiatives are in response to a State of Obesity report that stated that nearly a quarter of 10- to 17-year-olds in New Mexico were overweight or obese in 2016. The school banned junk food on campus during school hours for both students and staff, and offers healthy seasonal meals in its cafeteria. Students also take weekly trips to local farms to get an inside look at where their food comes from.

While the school...

Industry News & Opinion

Food delivery company Good Uncle is expanding to 15 college campuses this fall, The Daily Orange reports.

The company plans to grow along the East Coast and is looking at opening at schools such as George Washington University, Pennsylvania State University, Villanova University and American University. Good Uncle hopes to open at 50 to 100 campuses by 2019.

Starting as a delivery-only kitchen in 2016, Good Uncle partners with local restaurants to recreate their popular dishes and then deliver them to college students. The company offers free delivery, no delivery minimum...

Ideas and Innovation
wahoo tacos

School lunch is heating up. As expectations rise in the noncommercial sector, the old-fashioned cafeteria has become a hot topic. Political pressure on schools has seesawed over the past eight years, and nutritional regulations on items like sodium and whole grains have been overhauled (and back again). Meanwhile, students, parents, teachers, administrators and policymakers are demanding more healthfulness and better taste from school meals, often for the same cost.

Yet the industry’s best are dedicated to getting better, even while looking to the future with caution. “There’s not...

FSD Resources