FREMONT, Neb. (AP) — Lincoln Premium Poultry hopes to find 125 producers to provide poultry for a Costco processing plant in eastern Nebraska.
The Fremont plant is scheduled to open in about a year. Lincoln Premium Poultry is managing the facilities operations, which includes recruiting farmers to raise poultry, overseeing construction and recruiting employees.
The company was in negotiations with about 80 local farmers last month. It expects to continue recruiting operators into early summer.
Many of the farmers will be new to raising poultry. Doug Oertwich, who has a farm near Pilger, said the poultry project gives him the change to diversify his 700-acre corn and soybean farm. While he’s never raised poultry before, Oertwich said he’s not concerned about the new endeavor.
“I’ve worked with guys that raise hogs and cattle, and like any other animal, everything is in the details,” Oertwich said.
The company plans to help farmers new to the poultry industry by building a facility where producers and prospective producers can see how the computers and equipment in poultry houses are operated. The company will also send field technicians to help farmers implement and follow the best practices.
The contracts will last about 15 years. Farmers will be investing $2 million to $2.5 million to construct four poultry houses. The longer contract length lessens the risk by guaranteeing farmers 15 years of revenue.
“Nebraska farmers are making a sizable investment, and they are trusting in us to do the right thing by them,” said project manager Walt Shafer. “So we are working with Costco to put out a very, very fair contract that gives them every benefit of the doubt.”
Costco added a square-footage incentive for the poultry houses, which would give a farmer $120,000 for completing four houses.
“That’s one way for the company to invest in these farmers up front,” said Jessica Kolterman of Lincoln Premium Poultry. “And it really helps offset costs on the front side.”
The operation is expected to process up to 2 million birds a week. The plant is projected to have a $1.2 billion economic impact on the state, said Gov. Pete Ricketts.