More than 200 food companies across Europe have signed up to the European Chicken Commitment (ECC) since 2018. These companies will raise their animal welfare standards to the requirements of the ECC by 2026. The Eurogroup for Animals commissioned Wageningen University & Research to undertake a project to gain insight into the costs in various EU member states associated with transitioning to broiler production systems that comply with these requirements.
Various reports have been published in recent years by Wageningen Economic Research analysing the costs associated with broiler production systems. Report 2018-116 ‘Competitiveness of the EU poultry meat sector’ calculated the production costs of conventional broilers for 9 EU countries. Report 2020-027 ‘Economics of broiler production systems in the Netherlands’ compared the production costs of conventional broilers with different concepts for slow growing broilers.
Researchers recently made a combination of these 2 reports by comparing the production costs of conventional and ECC broiler production systems for 6 EU countries, these being the Netherlands, Poland, Germany, Italy, Spain and France. The costs are expressed in euros or eurocents.
Around 40-45% of the broilers in the Netherlands in 2021 were slow-growing broilers. Dutch farmers and partners in the production chain (hatcheries, parent stock farms, feed mills and slaughterhouses) have a lot of experience with slow-growing broilers. Therefore the production costs of conventional (fast growing) broilers and slow-growing broilers in the Netherlands were compared.
Conventional broilers (Ross308) were compared with slow-growing broilers that comply with the requirements of the European Chicken Commitment (ECC). The full standard is described in the Guidance Notes to the ECC (2022). The main criteria of the ECC are a maximum stocking density of 30 kg/m2, with thinning discouraged, the use of breeds with a higher welfare outcome, enrichment, including natural light, perches and 2 pecking substrates per 1,000 birds and the use of controlled atmospheric stunning using inert gas or a multi-phase system in the processing plant (CAS stunning).
Calculations were made for a farm with 3 poultry houses. The poultry houses have a floor surface area of 4,400 m2 in total. It was assumed that the floor surface area is fixed. By switching to the ECC standard with a lower density, this farm will keep a smaller number of broilers.
Table 1 shows the main assumptions made for the conventional broiler and ECC broiler with and without thinning. The final live weight is 2,500 grammes with a feed conversion of 1.57 for conventional broilers and 1.73 for the Hubbard Redbro. In the conventional situation the density is 20.5 birds per m2 (max 42 kg per m2 with thinning) and for ECC without thinning this is 12.3 birds per m2 and with thinning 14.5 birds per m2. One full-time worker will manage the farm with 90,000 conventional broilers (with thinning) or 54,158 ECC broilers without thinning.
Prices and other costs in the Netherlands were collected for the year 2021. This information showed that the day-old chick price of the slow-growing broiler (Hubbard Redbro) is slightly higher than the day-old chick price of a conventional broiler and the feed price in the ECC system is slightly lower than for the conventional system. As a result of the lower density under ECC, the costs of heating per broiler are higher. All these estimates are based on practical experience in the Netherlands in recent years.
To calculate the total production costs, the fixed costs, i.e., housing (including equipment), labour and general costs, were also included. The poultry house is depreciated over 25 years, and the equipment in 12.5 years. The researchers calculated the total production costs of conventional and ECC broilers with and without thinning based on the Netherlands situation and prices in 2021. The results are given in Table 2.
The total cost of conventional broilers (with thinning) is 92.4 cents per kg live weight. The total costs for ECC broilers with and without thinning are 108.2 and 112.3 cents per kg live weight, respectively. Figure 1 gives a breakdown of the cost components and illustrates that the ECC system has higher costs, mainly for housing, feed, labour and other variable costs (in that order). Other variable costs include electricity, heating, water, animal health, litter, catching and a few other minor cost items. ECC with thinning has a higher density on day 1, and as a result, the costs for housing and labour are lower compared to ECC without thinning.
Following the same method as used for the Netherlands, the production costs for conventional broilers in 5 other countries (Germany, France, Italy, Spain and Poland) were calculated. The basic data on performance and prices in these countries were adapted from Van Horne (2018) and updated to 2021 levels. The results for ECC (without thinning) for all countries are based on the Hubbard Redbro. The production costs (in cents per kg live weight) of a conventional broiler and under ECC without thinning are given in Figure 2.
As indicated, the production costs of the ECC broiler (without thinning) in the Netherlands are 19.9 cents higher (or 22% higher) than for conventional broilers. Because of differences in production performance and prices, the results in the other countries are not exactly the same as in the Netherlands: