Archive for Ostrich Processing

Farmer Slaughter Bird Payment Systems

When a farmer is selling to a processor it is essential that the payment structure rewards quality birds and penalises poor quality birds with minimal meat yield as the cost of processing these poor quality birds are significantly higher.  Poor quality, low yielding birds, all too often, also have poorer quality skins and feathers. The following are descriptions of the different payment methods that are or have been used over the years.

Slaughter Bird – based on live or deadweight:
The farmer is paid a price per bird, usually based on liveweight.  Over the years this has proved unsuccessful.  Currently liveweight is a poor guide to meat yield or quality of that meat.  Some birds carry an extensive amount of fat and others little or no fat. Genetics are also extremely variable at this time.  As the ostrich skin is paid on a grading system, there is no way to assess the quality of that skin while the bird is alive.  This method of farmer payment does not reward the quality bird adequately to encourage or support production of high yielding birds producing quality meat and skin.

All other payment systems currently used separate the payment of the skin and the carcass for assessing the total value of the farmer payment.   The skin may be retained by the farmer to sell directly or the slaughter facility will pay the farmer directly.   In some slaughter facilities where volume is sufficient, the feathers will be valued independently, but usually they are included in the price paid to the farmer for the carcass and meat.  While volumes are low, the market opportunities for the feathers are low in relation to the handling costs.

Carcass weight:   WOA Ostrich Benchmark Production Targets provides the definition of a carcass.

Payment by carcass weight maybe a set amount at the same weight per kilo for all birds, or it may be split into different weight classifications for a tiered payment structure.  The latter is preferable as it is much fairer to the good farmer.  It also encourages production of birds carrying higher meat yields, which are cheaper to process and return more revenue as illustrated in Figure 1.

77_processing_cost_br

Figure 2: Comparative Processing Costs relating to Meat Yield [Newsletter 77]

Boneless meat yield:  WOA Meat Yield Classifications provides the WOA standards.  This payment is based on the weight of the saleable meat removed from the carcass.  If offered payment in this way, the producer should ensure there is a very clear definition of all that is included and how it is calculated.  Payment on boneless meat yield basis will also have a weight classification system to enable a tiered payment structure to pay according to the yield class.

This tiered payment structure passes on savings made in the processing back to the farmer as he produced a better quality bird.  Figure 1 illustrated the savings in processing costs when valued on a per kilo basis.  Figure 2 illustrates comparative carcasses, illustrating different weights.

comparative carcasses

Figure 2: Comparative Carcasses

Figure 2 illustrates 2 carcasses.  The left hand carcass yielded 38% more meat, therefore 38% increased meat revenue and will have cost the same to slaughter and process.

Apart from weight the other difference in these birds is the days they took to reach this stage.  Clearly the increased yield was achieved as the bird was fed for 60 more days and that adds additional costs for the producer.  Another good reason for paying an increased price to represent the savings made on the kilo processing costs.

Carcass Grade:  The WOA Carcass Grading System provides definitions for the different grades in addition to payment structure based on yield classification, carcasses should be graded for quality. Grading will consider Bird Age, Fat Colour, Muscle Colouration, Heart Condition, Liver Condition, Presence of any Disease and any other condition that is not acceptable – such as bruising.  Carcass grade can be applied to any of the above payment systems.  This also helps differentiate the age of the birds to ensure older birds are not slipped into a batch of slaughter birds.

This discussion relates to payment systems for payments to the producer of birds by buyers of slaughter birds to encourage the production of better quality birds.   Many of the South African slaughter plants were owned by the producers.  These test birds were slaughtered in such a slaughter plant.  Whilst the managers the farmer’s employed to slaughter and market their birds could see these benefits, the challenge was the getting the farmers to understand the benefits and how they could achieve the improved production.

How do Buyers of Slaughter Birds verify the Age of Birds?
The answer to this question currently is very simple. The supplying farm must have verifiable records that record the date of hatch.

Ostrich do change their feathers at particular stages of growth. The diet the birds are fed and the management of the birds influence the stages of growth and these can be extremely variable.

In the mid 1990s some South African scientists produced data based on bone development as a means of verifying the age of birds. However bone development is also diet dependent, so is not a reliable method to determine bird age accurately without comparative studies.

Ostrich Value Chain – 1

Newsletter No. 74

The items in this newsletter discussed a new develpment that provided a great practical example of a value chain and the importance of working in a collaborative manner.  For ease of reading in the blog environment, we will split the segments over several blogs.

Introduction
We receive many emails from people asking for assistance when wishing to join the industry – usually as a farmer.  The first question we always ask is “what is the scale you wish to enter?” and "is there an infrastructure in place to slip into?".  If the answer is no sufficient resources are required to build the infrastructure, volume required for viability and market development.

Unfortunately as our industry has developed over the last couple of decades, the approach has generally been to sell a trio or a few chicks to new farmers before the building of sufficient infrastructure to support new producers.   Earlier newsletters have discussed the principals and importance of value chains.  A new initiative came into being in March (2008) that incorporates those principles and illustrates one route to accomplish them.

Developments in Southern Africa
Many of you will be familiar with the ostrich operation run by Peter Cunningham in Bulawayo, Zimbabwe.  In recent years a project based on this operation has been developed to help small farmers into viable ostrich production in South Africa.  They have recently published their business plan and presentation on the internet, the company started trading under the current infrastructure in March.  The home page is http://www.khula-sizwe.com (web site no longer active).  The plan addresses many of the issues required to provide sufficient infrastructure to support small producers.  They list the following key points as barriers to entry for small farmers:

a)   Lack of infrastructure & collateral for production loans

b)   Lack of Industry and market information

c)   Lack of technical knowledge and experience

d)   High Industry entry costs

e)   Inability to supply high volumes demanded by the industry

f)    Inability to comply to quality standards and registration requirements for market access

The above list can be consolidated into 3 major areas that we will discuss in this newsletter.

Markets
Before investing in ostrich farming or an ostrich project, it is extremely important to know the markets to be serviced as different markets have different requirements relating to such things as:

a) State Veterinary Requirements
b) Buyer Veterinary Requirements
c) Type of Meat Cuts, Skin, Fat etc.
d) Traceability
e) Residue Testing

This business plan illustrates just how important knowing your markets is before building the infrastructure.  For example their target market is the EU and to supply that market the supplying farms require registration by the EU, so it will be essential to know the regulations prior to construction. You will note the requirement of quarantine pens.  These are required in Southern Africa to satisfy the EU in relation to Congo Fever, a tick born infection.

Even when supplying domestic markets only, it will still be essential to know the requirements of the local veterinary authorities and local buyers.  Do your buyers require you to be part of an assurance scheme, if they do, what are the requirements?  Assurance schemes are discussed here and here.

World Ostrich Association Publications

The World Ostrich Association (WOA) has a number of publications available to support its members.   All are available free to members of the association and most are also available to download in PDF format.  These are important docucments to support producers, processors and the buyers of Ostrich Products.

WOA Ostrich Carcass Grading processors and meat buyers

WOA Ostrich Yield Payment  processor farmer payment

WOA Factors Influencing Ostrich Meat Quality producers and processors

WOA Ostrich Skin and Finished Leather Grading producers, processors and buyers

WOA Ostrich Feather Structure and Quality producers, processors and buyers

WOA Ostrich Benchmark Performance Targets producers

WOA Ostrich Welfare Guidelines producers, processors and buyers

WOA Guide to Valuing Ostrich Buying, Selling or Insurance claim – how do you value an ostrich?   Available to members only

Ostrich Farming Business Planning Planning Profitable Ostrich Farming from ‘Farm to Plate’   Available members only

Understanding the Productive Value of Alfalfa
This is not a WOA production, but as it is of significant importance in ostrich production, it is included.  It is a link to an external web site.