I liked the cattle feed comments.
Having been in the chicken game, the implications are marginalized here.
Bez
---------------------------------------
From the Wiles Journal Patriot - dated 25 Feb 2008
Growers ponder Fibrowatt contracts
by Jule Hubbard
Plans for a Fibrowatt LLC plant in Wilkes or Surry counties that would produce electricity by burning chicken litter now hinge largely on how many area chicken growers sign contracts for selling litter to the company, said area poultry industry spokesmen.
Fibrowatt officials say they’re on the verge of announcing if they’ll build the power plant off River Road/Liberty Grove Road just east of North Wilkesboro or near N.C. 268 east of Elkin, but most area growers still haven’t turned in signed contracts to the company.
Litter in big demand
What’s new is a dramatic rise in demand and prices paid for chicken litter in the last year due to soaring commercial fertilizer prices and increased use of litter as cattle feed that has been “drystacked” to kill pathogens.
Fibrowatt President Rupert Fraser said in an interview last week that he remained confident the company could buy enough litter to justify building the plant in Wilkes or Surry, but he said the company would “build a plant that will fit the amount of litter the growers want to sell us.”
“Right now, fertilizer prices are high…. If our project can get off the ground, we will be there year in and year out as a long-term solution (for disposing of litter) and not with the ups and downs” of commodities like fertilizer, said Fraser.
He added, “Looking at Wilkes County’s long history of litter production, I don’t think anyone doubts that there is enough. I don’t think anything has changed with the availability of litter” for Fibrowatt.
For at least two years and as recently as mid-November 2007, Fibrowatt officials said they would buy about 500,000 tons of chicken litter annually from growers in Wilkes and other area counties for a facility costing as much as $150 million to build. Fibrowatt officials and others have said 500,000 tons is about half of the litter produced in Wilkes and about seven other area counties.
Officials with Springdale, Ark.-based Tyson Foods Inc. estimate that its 290 contract farms in Wilkes, Alexander, Surry and Catawba counties that raise chickens in 962 houses for Tyson’s processing facilities in Wilkesboro alone produce over 550,000 tons of litter annually.
Sam Whittington, live production manager for the Tyson processing complex in Wilkesboro, said 223 to 225 tons of litter can be taken from a chicken house over two years.
Cathy Bunton, area state poultry specialist, said 148 million chickens are produced annually in Wilkes, Caldwell, Catawba, Yadkin, Burke, McDowell, Alexander and Surry counties. She said all of these producers would be in reach of the Fibrowatt plant in Surry or Wilkes.
Oakwood, Ga.-based Wayne Farms is the area’s second largest chicken producer, with 135 contract farmers mostly in Surry and Wilkes counties.
Wayne spokesman Stan Hayman said the company believes Fibrowatt would be good for the area poultry industry and overall economy, but he said Wayne officials haven’t been involved in discussions between their contract growers and Fibrowatt officials. Contract chicken growers with Salisbury, Md.-based Case Foods Inc., with processing facilities in Morganton, also have been offered contracts.
Tyson takes active role
Tyson Foods officials in Wilkes became involved in efforts to bring Fibrowatt and in discussions with Tyson growers concerning Fibrowatt contracts soon after the Wilkes Economic Development Corp. invited the company to consider Wilkes over 2½ years ago.
Tyson growers were asked to sign letters of commitment during meetings early in the process. About half of Tyson’s growers received contracts in late 2007 and the other half got them in the third week of January.
“We would love to have signed contracts in by the 15th of March. We send packets of them every week as they come in from growers” to Fibrowatt, said Whittingon. Many growers are still checking on nutrient levels in their soil from litter spread as fertilizer to help them determine how much litter they’ll sell to Fibrowatt, he added.
Tyson now encourages growers to totally clean out litter from houses every other year, said Whittington, explaining that this produces healthier and more profitable birds. Without the option of selling to Fibrowatt, growers have been cleaning out houses less often and leaving a layer of litter about eight inches thick.
The 10-year contracts call for Fibrowatt to pay growers $2 to $2.50 per ton of litter if Fibrowatt contract haulers remove litter from chicken houses and load it on trucks or $4 to $4.50 per ton if growers remove and load litter on contractors’ trucks.
Growers get higher pay at these two levels ($2 to $2.50 or $4 to $4.50) for litter with less moisture, said Whittington. These pay ranges increase during the 10 years, based on a percent of the Consumer Price Index, he added.
That compares to unheard of high prices, from $7 to $25 or more per ton depending on the situation, being paid for chicken litter as a considerably less costly alternative to commercial fertilizer for corn fields and pastures.
Commercial nitrogen fertilizer prices are soaring because natural gas is a key ingredient. Phosphorus and potassium, the other two primary ingredients in commercial fertilizer, cost more mainly due to increased demand for them in other parts of the world. Demand is also up because more cattle are being fed chicken litter due to a severe hay shortage. Litter is selling for as much as $25 a ton as cattle feed.
Fibrowatt “big step
for future”
A year ago, Bobby Faw was running out of storage space for chicken litter from his Tyson Foods Inc. contract broiler farm.
“Last year, I had trouble giving it away. Now it seems like everybody and their brother is calling me for it,” said Faw, who lives and farms on Radical Road in McGrady.
Faw said he already agreed to sell 680 tons of litter to Fibrowatt annually in a contract he signed, leaving about 30 to 40 percent of the litter from his seven chicken houses for uses that include fertilizing the 130 acres of pasture where he raises beef cattle.
“From what I have seen and heard, most growers will sign up most of their litter with Fibrowatt…. For Wilkes County, this is a big step for the future. This will take care of litter problems and let Tyson and Wayne expand. It will also allow growers to expand,” he said. “It will also produce good jobs.”
Whittington said Tyson is still trying to add growers.
Tyson Foods contract broiler producer Eric Bumgarner of Purlear said he’s leaning towards signing a contract with Fibrowatt, but that he would keep at least some of his litter to share with neighbors who help him.
“I would love to see them (Fibrowatt) come here because it would be good for the county. Maybe it would open some eyes and make it possible for farmers to burn litter for heat, but it would never replace propane for heating poultry houses,” said Bumgarner.
He said he planned to start completely cleaning out his chicken houses every two years as recommended by Tyson, which he said will likely become mandatory. “With total cleanout, you get drier litter so you get more for it,” he said, in addition to health benefits for chickens.
Bumgarner said he understood cattle and corn producers being concerned about having enough litter, but he noted that litter is a commodity and as such would go up and down in demand over time.
“One of my biggest expenses is moving litter around” with equipment, due to fuel and labor costs. Having Fibrowatt remove litter from his houses and haul it away would reduce his costs, said Bumgarner.
A chicken grower in southwestern Wilkes who didn’t want his name published said he didn’t have enough land to handle all of his litter as fertilizer and that a Fibrowatt contract would keep this from being a problem for his wife if he died.
“Plus, we don’t know what will be required in the future with regulations” concerning litter, particularly phosphorous levels. “More people are complaining when we spread litter in the fields,” he said.
“I think I’ll make as much or more money selling to Fibrowatt as I do now selling it to others because of the savings on equipment and fuel.... I feed litter to my cattle and I plan to keep enough for that” in his contract with Fibrowatt, he added.
“I was told that if you don’t sign up now (with Fibrowatt), you won’t be able to sign up during the 10-year period once it has started.”
This grower and another one said selling litter to Fibrowatt would ease their concerns about whether people who buy their litter for use as fertilizer leave them with legal risks by not following soil test regulations.
Some against selling
to Fibrowatt
A northeastern Wilkes chicken grower who didn’t want his name published said he wouldn’t sign a contract with Fibrowatt because “litter is more valuable for the land than for being burned by those people.... There is just too much use for it to justify burning it.”
The man said all of the chicken litter produced on his farm stays there for use as fertilizer in his cornfields and for feeding his cattle.
Kirk Mathis, part of the family-owned and operated Cranberry Farms in the Cranberry community of eastern Wilkes, said he doesn’t plan to sign a contract with Fibrowatt because litter from Tyson chicken houses on the Mathis farm is needed as an alternative to liquid nitrogen fertilizer in the operation’s cornfields. Mathis said cost of liquid nitrogen has risen from $180 a ton two years ago to a predicted $450 a ton or more this spring.
“I don’t see any change in this high cost because the (related) prices for propane and natural gas aren’t coming down in the next two years,” he said.
He noted that cattle on the farm have been fed litter since the late 1960s.
Although litter from the Mathis farm isn’t sold to other farmers, Mathis said litter from elsewhere in Wilkes is sold to farmers in many other parts of the state and other states.
Two cattle producers in the Shepherds Crossroads community north of
Roaring River said they wanted to buy chicken litter but couldn’t find any for sale this winter. The two said they couldn’t understand chicken farmers signing contracts to sell litter to Fibrowatt for much less money than they were willing to pay.
“I think it’s crazy,” said Glenn Weston, whose family farming operation in Boomer includes corn and cattle but not chickens, about Fibrowatt’s plans. “I just don’t see how it can be cost efficient. I’m sure it will have to be subsidized.”
He added, “The demand for (chicken litter as) feed is greater than ever this year. I already have a hard enough time finding enough litter to fill my needs. I totally disagree with the Fibrowatt deal and Wilkes County doesn’t need it.”
Sam Walker of Moravian Falls, who buys chicken litter in Wilkes and sells it mostly to farmers out of state, said he raised his prices this year for the first time since 1994 due to fuel costs.
“I don’t think the price of litter will come back down. I could be selling twice as much as I do now if I could get it,” mostly to beef producers, said Walker. He said higher prices charged for sawdust, which is about 30 percent of chicken litter, makes it harder for litter prices to drop.
Despite higher prices paid for litter by other farmers, Walker said he thinks a lot of chicken growers will sign contracts with Fibrowatt
Having been in the chicken game, the implications are marginalized here.
Bez
---------------------------------------
From the Wiles Journal Patriot - dated 25 Feb 2008
Growers ponder Fibrowatt contracts
by Jule Hubbard
Plans for a Fibrowatt LLC plant in Wilkes or Surry counties that would produce electricity by burning chicken litter now hinge largely on how many area chicken growers sign contracts for selling litter to the company, said area poultry industry spokesmen.
Fibrowatt officials say they’re on the verge of announcing if they’ll build the power plant off River Road/Liberty Grove Road just east of North Wilkesboro or near N.C. 268 east of Elkin, but most area growers still haven’t turned in signed contracts to the company.
Litter in big demand
What’s new is a dramatic rise in demand and prices paid for chicken litter in the last year due to soaring commercial fertilizer prices and increased use of litter as cattle feed that has been “drystacked” to kill pathogens.
Fibrowatt President Rupert Fraser said in an interview last week that he remained confident the company could buy enough litter to justify building the plant in Wilkes or Surry, but he said the company would “build a plant that will fit the amount of litter the growers want to sell us.”
“Right now, fertilizer prices are high…. If our project can get off the ground, we will be there year in and year out as a long-term solution (for disposing of litter) and not with the ups and downs” of commodities like fertilizer, said Fraser.
He added, “Looking at Wilkes County’s long history of litter production, I don’t think anyone doubts that there is enough. I don’t think anything has changed with the availability of litter” for Fibrowatt.
For at least two years and as recently as mid-November 2007, Fibrowatt officials said they would buy about 500,000 tons of chicken litter annually from growers in Wilkes and other area counties for a facility costing as much as $150 million to build. Fibrowatt officials and others have said 500,000 tons is about half of the litter produced in Wilkes and about seven other area counties.
Officials with Springdale, Ark.-based Tyson Foods Inc. estimate that its 290 contract farms in Wilkes, Alexander, Surry and Catawba counties that raise chickens in 962 houses for Tyson’s processing facilities in Wilkesboro alone produce over 550,000 tons of litter annually.
Sam Whittington, live production manager for the Tyson processing complex in Wilkesboro, said 223 to 225 tons of litter can be taken from a chicken house over two years.
Cathy Bunton, area state poultry specialist, said 148 million chickens are produced annually in Wilkes, Caldwell, Catawba, Yadkin, Burke, McDowell, Alexander and Surry counties. She said all of these producers would be in reach of the Fibrowatt plant in Surry or Wilkes.
Oakwood, Ga.-based Wayne Farms is the area’s second largest chicken producer, with 135 contract farmers mostly in Surry and Wilkes counties.
Wayne spokesman Stan Hayman said the company believes Fibrowatt would be good for the area poultry industry and overall economy, but he said Wayne officials haven’t been involved in discussions between their contract growers and Fibrowatt officials. Contract chicken growers with Salisbury, Md.-based Case Foods Inc., with processing facilities in Morganton, also have been offered contracts.
Tyson takes active role
Tyson Foods officials in Wilkes became involved in efforts to bring Fibrowatt and in discussions with Tyson growers concerning Fibrowatt contracts soon after the Wilkes Economic Development Corp. invited the company to consider Wilkes over 2½ years ago.
Tyson growers were asked to sign letters of commitment during meetings early in the process. About half of Tyson’s growers received contracts in late 2007 and the other half got them in the third week of January.
“We would love to have signed contracts in by the 15th of March. We send packets of them every week as they come in from growers” to Fibrowatt, said Whittingon. Many growers are still checking on nutrient levels in their soil from litter spread as fertilizer to help them determine how much litter they’ll sell to Fibrowatt, he added.
Tyson now encourages growers to totally clean out litter from houses every other year, said Whittington, explaining that this produces healthier and more profitable birds. Without the option of selling to Fibrowatt, growers have been cleaning out houses less often and leaving a layer of litter about eight inches thick.
The 10-year contracts call for Fibrowatt to pay growers $2 to $2.50 per ton of litter if Fibrowatt contract haulers remove litter from chicken houses and load it on trucks or $4 to $4.50 per ton if growers remove and load litter on contractors’ trucks.
Growers get higher pay at these two levels ($2 to $2.50 or $4 to $4.50) for litter with less moisture, said Whittington. These pay ranges increase during the 10 years, based on a percent of the Consumer Price Index, he added.
That compares to unheard of high prices, from $7 to $25 or more per ton depending on the situation, being paid for chicken litter as a considerably less costly alternative to commercial fertilizer for corn fields and pastures.
Commercial nitrogen fertilizer prices are soaring because natural gas is a key ingredient. Phosphorus and potassium, the other two primary ingredients in commercial fertilizer, cost more mainly due to increased demand for them in other parts of the world. Demand is also up because more cattle are being fed chicken litter due to a severe hay shortage. Litter is selling for as much as $25 a ton as cattle feed.
Fibrowatt “big step
for future”
A year ago, Bobby Faw was running out of storage space for chicken litter from his Tyson Foods Inc. contract broiler farm.
“Last year, I had trouble giving it away. Now it seems like everybody and their brother is calling me for it,” said Faw, who lives and farms on Radical Road in McGrady.
Faw said he already agreed to sell 680 tons of litter to Fibrowatt annually in a contract he signed, leaving about 30 to 40 percent of the litter from his seven chicken houses for uses that include fertilizing the 130 acres of pasture where he raises beef cattle.
“From what I have seen and heard, most growers will sign up most of their litter with Fibrowatt…. For Wilkes County, this is a big step for the future. This will take care of litter problems and let Tyson and Wayne expand. It will also allow growers to expand,” he said. “It will also produce good jobs.”
Whittington said Tyson is still trying to add growers.
Tyson Foods contract broiler producer Eric Bumgarner of Purlear said he’s leaning towards signing a contract with Fibrowatt, but that he would keep at least some of his litter to share with neighbors who help him.
“I would love to see them (Fibrowatt) come here because it would be good for the county. Maybe it would open some eyes and make it possible for farmers to burn litter for heat, but it would never replace propane for heating poultry houses,” said Bumgarner.
He said he planned to start completely cleaning out his chicken houses every two years as recommended by Tyson, which he said will likely become mandatory. “With total cleanout, you get drier litter so you get more for it,” he said, in addition to health benefits for chickens.
Bumgarner said he understood cattle and corn producers being concerned about having enough litter, but he noted that litter is a commodity and as such would go up and down in demand over time.
“One of my biggest expenses is moving litter around” with equipment, due to fuel and labor costs. Having Fibrowatt remove litter from his houses and haul it away would reduce his costs, said Bumgarner.
A chicken grower in southwestern Wilkes who didn’t want his name published said he didn’t have enough land to handle all of his litter as fertilizer and that a Fibrowatt contract would keep this from being a problem for his wife if he died.
“Plus, we don’t know what will be required in the future with regulations” concerning litter, particularly phosphorous levels. “More people are complaining when we spread litter in the fields,” he said.
“I think I’ll make as much or more money selling to Fibrowatt as I do now selling it to others because of the savings on equipment and fuel.... I feed litter to my cattle and I plan to keep enough for that” in his contract with Fibrowatt, he added.
“I was told that if you don’t sign up now (with Fibrowatt), you won’t be able to sign up during the 10-year period once it has started.”
This grower and another one said selling litter to Fibrowatt would ease their concerns about whether people who buy their litter for use as fertilizer leave them with legal risks by not following soil test regulations.
Some against selling
to Fibrowatt
A northeastern Wilkes chicken grower who didn’t want his name published said he wouldn’t sign a contract with Fibrowatt because “litter is more valuable for the land than for being burned by those people.... There is just too much use for it to justify burning it.”
The man said all of the chicken litter produced on his farm stays there for use as fertilizer in his cornfields and for feeding his cattle.
Kirk Mathis, part of the family-owned and operated Cranberry Farms in the Cranberry community of eastern Wilkes, said he doesn’t plan to sign a contract with Fibrowatt because litter from Tyson chicken houses on the Mathis farm is needed as an alternative to liquid nitrogen fertilizer in the operation’s cornfields. Mathis said cost of liquid nitrogen has risen from $180 a ton two years ago to a predicted $450 a ton or more this spring.
“I don’t see any change in this high cost because the (related) prices for propane and natural gas aren’t coming down in the next two years,” he said.
He noted that cattle on the farm have been fed litter since the late 1960s.
Although litter from the Mathis farm isn’t sold to other farmers, Mathis said litter from elsewhere in Wilkes is sold to farmers in many other parts of the state and other states.
Two cattle producers in the Shepherds Crossroads community north of
Roaring River said they wanted to buy chicken litter but couldn’t find any for sale this winter. The two said they couldn’t understand chicken farmers signing contracts to sell litter to Fibrowatt for much less money than they were willing to pay.
“I think it’s crazy,” said Glenn Weston, whose family farming operation in Boomer includes corn and cattle but not chickens, about Fibrowatt’s plans. “I just don’t see how it can be cost efficient. I’m sure it will have to be subsidized.”
He added, “The demand for (chicken litter as) feed is greater than ever this year. I already have a hard enough time finding enough litter to fill my needs. I totally disagree with the Fibrowatt deal and Wilkes County doesn’t need it.”
Sam Walker of Moravian Falls, who buys chicken litter in Wilkes and sells it mostly to farmers out of state, said he raised his prices this year for the first time since 1994 due to fuel costs.
“I don’t think the price of litter will come back down. I could be selling twice as much as I do now if I could get it,” mostly to beef producers, said Walker. He said higher prices charged for sawdust, which is about 30 percent of chicken litter, makes it harder for litter prices to drop.
Despite higher prices paid for litter by other farmers, Walker said he thinks a lot of chicken growers will sign contracts with Fibrowatt
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