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Message: Re: Press Release - some numbers
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Jul 01, 2008 07:14AM
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Jul 01, 2008 07:51AM

Re: Press Release - some numbers

in response to by
posted on Jul 01, 2008 08:00AM

My interpretation of what the results of this test mean in real numbers...

1) 900,000,000 broilers lost annually to IP roughly translates into about 1.5 to 2 billion dollars to the industry. If one were to assume all the birds were full grown at mortality, the number would be close to $4 billion. However when birds die from IP before maturing, they stop consuming feed and the feed savings reduces the losses. This is a difficult number to calculate, but $1.5 - 2 billion is a safe estimate.

2) 2.4% weight gain translates into $.08 additional value per broiler. The cost of AGrastim is approximately $.02 per bird, resulting a net savings of $.06 per bird. That $.06 doesn't seem like much until you begin to multiply it times the number of broilers companies like Pilgrim's Pride or Tyson process in a week. 2.4% of the number of birds one of the big two processes in a week would represent savings $3.9M / week, including the AGrastim costs. This translates into approximately $45M / week for the entire US poultry industry.

3) The numbers above are a little deceptive in that with the current cutbacks in production due to excessive feed costs, it is unlikely the industry would increase output by 2.4%. What is more likely is that they would reduce the number of birds produced, but realize the same meat production with fewer birds. This would translate into significant feed and other cost savings of as much as $40M/week for the entire industry, or $3+M/week for companies like Pilgrim's Pride or Tyson. That doesn't even include an additional $200M or so saved by the elimination of IP.

I see these numbers as extremely significant.

For what it's worth.

-zties



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