The Shadow
FARMVILLE (VR) — Though Tyson Foods continues contract buyout payments with longtime chicken grower Pete Watson, four broiler houses sit empty on his Nottoway County farm after 32 years in the business.
Poultry production is a livelihood Watson planned to pass on to his son and co-operator, 32-year-old William “Rooster” Watson.
Citing its “inability to economically improve operations” in Central Virginia, Tyson Foods announced it was closing its Glen Allen processing facility in March 2023. This decision affected 700 processing plant jobs, and it left 55 Central Virginia farms with empty poultry houses and the question of farm succession and survival.
“I have two little ones myself,” Rooster Watson said, “and I hoped one of them would be interested in running the farm someday too.”
More than 50 impacted poultry growers gathered in Farmville Feb. 22 to hear about the formation of the Central Virginia Poultry Cooperative Inc. and its 13-year agreement to sell cage-free eggs to Indiana-based Dutch Country Organics LLC. With a mix of excitement and healthy skepticism, growers learned how CVP will support a mass pivot from raising broiler chickens to pullet and table egg production. Dutch Country supplies eggs to major grocery chains, including Aldi, Costco, Kroger and Walmart Inc.
Virginia Farm Bureau Federation and the Virginia Foundation for Agriculture, Innovation and Rural Sustainability worked with producers to help establish the new cooperative and partnered with localities and the state to help structure an economic development package for CVP that will benefit both chicken producers and grain growers in the region.
In December 2023 the Commonwealth Regional Council was awarded a $35,000 planning grant from the Governor’s Agriculture & Forestry Industries Development Fund on behalf of CVP. The planning grant was matched by funding from the council’s member counties: Amelia, Buckingham, Charlotte, Cumberland, Lunenburg, Nottoway and Prince Edward. These counties stand to benefit from the return of poultry production to the region.
In turn, the VFBF board of directors authorized up to $500,000 for the purchase of CVP’s non-voting Class B preferred stock, pending approval of certain cooperative documents, said Scott Sink, VFBF vice president.
“I apologize your worlds got turned upside down last March,” he told growers at the Feb. 22 gathering. “But I’m in awe of what you’ve been able to put together in less than a year.”
In pivoting from broiler production to pullets and eggs, infrastructure conversions are required, like pouring expensive concrete slabs for cage-free hen houses. That capital investment worried some growers in the room.
However, Dutch Country’s contract with CVP will allow CVP to offer producers long-term contracts that should make grower financing more attractive for lending institutions, said Bill Osl, co-op public director and VFBF board member.
At a Feb. 28 press event at Tom Schaubach Farm in Burkeville, Virginia Secretary of Agriculture and Forestry Matt Lohr announced the Governor’s AFID Infrastructure Grant will award a $50,000 matching grant to the Commonwealth Regional Council on behalf of CVP for capital expenses. Additionally, the Virginia Department of Agriculture and Consumer Services will award $341,750 from its Rural Rehabilitation Trust Fund for capital expenses related to biosecurity and food safety.
The Tobacco Region Revitalization Commission also announced a $1.4 million grant to assist CVP with certain startup costs during its first two years of operation. CVP will provide matching funds.
CVP will provide its producers with chickens and feed, and arrange the sale and distribution of the eggs. Producer members will be responsible for converting their housing and raising pullets or producing eggs according to prescribed standards. CVP will pay the producers on a per-bird or per-egg basis. The member-owned cooperative will sell the eggs to Dutch Country Organics, which will clean, sort and grade the eggs.
Each CVP member will have one share of common stock and a say in governing the cooperative, including selecting the board of directors. Producers also must purchase shares of non-voting Class A preferred stock in order to raise pullets or eggs. CVP is offering poultry producers a 20% discount on the purchase of Class A stock before the March 31 deadline.
To learn more about CVP membership or investment opportunities, contact chair John Bapties at 434-547-8242 or johnbapties@gmail.com.
