Mixed farm started with 50 chickens, ramped to 25,000 in niche market program; now seeks on-farm processing

By Tom Collins
COLDWATER — Canada’s only commercial supplier of pastured chicken got into the business 15 years ago with just enough chickens to feed their family of six.

Chad and Dorothy Coghlin now raise 25,000 chickens annually at Coldwater, 20 minutes north of Barrie. They started small. Really small.

The couple began raising about 50 chickens when they purchased the farm in 2005 and worked a few off-farm jobs to help them get going. The farm’s revenue came mostly from selling horse hay, beef and pigs. However, friends and family were always asking if they could buy some of those home-grown free-range chickens. When the Chicken Farmers of Ontario started offering producers the chance to raise chickens under the artisanal chicken program five years ago, the Coghlins jumped at the opportunity to raise up to 3,000 free-range chickens without quota.

After two years in the program, the Coghlins were approached by NutraFarms, which sells and delivers specialty pork, beef and chicken directly to households. NutraFarms was looking for a farmer who could raise a large number of specialty chickens, meaning free-range (with access to barn and outdoors) or pasture chickens (access to fresh grass).

That’s when the Coghlins discovered that the CFO also offers the local niche program. They applied, were approved and had their first batch of quota chickens in the fall of 2017, around the same time they stopped working off-farm jobs. They are the only members of the local niche program, which allows producers to buy 1,000 to 10,000 units of quota and market the chickens themselves. Members of the program need to grow their chickens for a unique market.

NutraFarms helped the Coghlins buy the quota. They also took out a bank loan.

A traditional Ontario chicken farm must have a minimum of 14,000 units of quota, and has an average of almost 33,000 units. The Coghlins have 5,000 units.

The program came with its fair share of challenges. Going from 3,000 birds to 25,000 within a year is a big jump. “We work 14-hour days from the end of March to November, seven days a week, with these chickens,” Coghlin said.

The toughest part was finding a processor. The Coghlins aren’t large enough to go with the largest commercial processors but they are too big for what the normal small-scale abattoir operators could handle. The only processor that would take all their chickens was three hours away and they needed to book two years in advance.

The Coghlins have yet to make a profit. “Last year we joked that we broke even,” he said. But the couple believes they can make a full-time living out of this. To do that, they are looking at ways to do their own on-farm processing.

“Fifty per cent of our gross costs are processing,” he said. Having their own on-farm facility would also eliminate transportation costs and allow for more flexibility. “We found it very challenging to grow a chicken to the size that my customer wanted. We’re growing to a date, and what we’d like to do is grow to a weight. So when my chickens are ready, then we process them.”

The Coghlins are also looking for more customers. Depending on one buyer is “kind of scary,” Coghlin said. They have room to grow. They can double their production under the local niche program but would need to buy more quota.

Quota is sold through private sales and the CFO only keeps track of paperwork. They don’t set a price or control any part of the business transactions. That makes it difficult to buy more quota and is often a barrier for new farmers. As it stands now, “there’s no way to buy quota because nobody wants to sell us quota,” Coghlin said.

Each unit of quota is currently about $150, and is good for about 14 kg of chicken, or about five chickens. That means it would cost $1 million for about 6,600 units of quota, or about 33,000 chickens. The Coghlins raise about 5,000 birds at a time.

So why pasture? The Coghlins used to have free-range chickens where the birds could wander away from the barn, but found some chickens never left the barn.

“Some birds were ambitious and all they wanted to do was go outside,” said Coghlin. “There was a fairly large percentage of them that would stay in the barn and sit at the feeder and eat all day. We were never confident that we were producing a consistent product because we didn’t know which birds were the birds that went outside and which birds stayed inside.”

The couple created their own pasture pens. About 1,500 birds are kept in a 1,500 sq. ft. pen with a large green covering over it like a tent. The bottom of the structure has a screen to keep out weasels and raccoons. Using a tractor, each pen is dragged slowly — with the birds inside — every 24 hours to allow chickens access to fresh grass. The birds don’t leave the pen. The Coghlins have three and expect to have two more this year to reduce density per pen.

Raising birds this way is more demanding to manage than keeping the chickens in a barn as the Coghlins have to keep adding water and feed to each pen multiple times per day. The chickens also remain on the farm for a longer time — about 60 days compared to 40 days on traditional farms — as they grow to a bigger size.

The main advice Coghlin would have for those wanting to get into the industry is to make sure they have a solid grasp of the costs, and then factor in another 10 to 20 per cent for the costs for the things you don’t anticipate. For example, there are birds that are too big or small for the customer or birds that may have a damaged wing. Even if 90 per cent of the chickens are perfect, 10 per cent aren’t and the buyer doesn’t want them.

“That means I still have 2,500 chickens that don’t meet my customer’s demands and I don’t have a market for,” he said. “When you start adding that up, that could be $70,000-$80,000 in chicken that is challenging to sell.”