An opportunity has presented itself to us in the Contract broiler farming sector. Our Company has been accepted as a preferred contract grower for one of the major role players in South Africa. A 10-year grower contract will be signed.
The plan is to build 36 chicken runs on a 300ha farm at a total cost of +- $14,5million (R120million) of which 92.5% will be financed by the major role player and the remaining 7.5% is required for start-up (which will buy the farm, including earthworks, electric fencing, office & ablution blocks, gas plants, generators, computers, water pipes, pumps and reservoirs). The chicken runs will deliver +-1,44 million chickens per cycle of average 34 days.
The major role player providing the 10 year grow contract has a processing plant with capacity to slaughter more than 2 million broilers per week in the area of the project.
The major role player supply broilers to the leading food suppliers in the country (South Africa).
The major role player has outsourced some of their broiler production aspects of the enterprise. It however requires an increased chicken supply to meet market demands.
The major role player will award a contract with a fixed margin above costs (Day-old Chickens, feed and medicine) and a bonus system linked to the weight of the chickens.
The major role player's business includes Feed Mills for feed production, Poultry production Units for Day-old Chickens and Broiler Meat production as well as Chicken Abattoirs.
The business concept is to supply broilers to fill part of this capacity.
The investor must invest $1,25million (R10million) for 20% shareholding. The 100% shareholding in the company will pay the investor back 20% per annum over 5 years or 18% per annum over 4 years or 16% per annum over 3 years and the investor will share in the profits per cycle.
Our team have been involved in the poultry industry for the past 22 years with experience in broiler farming and various other poultry related productions, such as rearing chickens for point of lay as well as Layer production. In 2005 the team was involved in the planning and setting up of a poultry farm containing 12 broiler producing houses, capacity for 492,000 birds per cycle. Gatehouse, LP gas supplying plant, water and electricity supplying plants, ect. The team managed 12 environmental controlled houses supplying close to 24 million kg’s of meat to a leading broiler producing Company in the industry. Since 2008 the team was advising 5 contract growers on a consulting basis. The team managed the controllers in the chicken houses with the correct pre-settings and trained the managers and their labourers on how to manage and grow their chickens effectively in a controlled environment, how to be effective in bio security, administering vaccinations and medication etc.
The poultry houses are equipped with the latest technology. The temperature, feeding- and watering systems are all computerised and monitored continuously.
This is refined to such an extent that, should anything happen which are not the norm and the set standards, ones mobile phone will ring to alert you. Also with any other alarms which may occur.
The ventilation and heating systems are automatically switched on and off, should temperatures vary. The controller’s alarm systems are tested on a weekly basis and one has to make sure there are no faults or errors. All activities and temperatures are plotted on graphs via the SKOV software program, imported from Denmark. The sites are all linked to the Farm's Online Program from where one can dial up via internet connection and observe the growing and production of the chickens at anytime from anywhere in the world, via your Notebook computer, iphone etc. There will also be a control room in line of sight with all houses, which will be linked with all the site’s chicken house controllers and will be manned and monitored 24/7 to be able to react immediately when a problem or alarm occurs and management can thus be informed.