Iowa's Turkey Processors Give Producers Room To Grow

AMES, Iowa — Iowa turkey production increased between 1996 and 2006 and has the potential for more growth, according to a report on the industry produced by the Iowa State University economics department. Economist John Lawrence and Laura Bortz, an Iowa State agricultural business senior, are the authors of "Iowa's Turkey Industry," which was published in January. The Iowa Turkey Marketing Council provided funding for the report. Of the top seven turkey-producing states, only Iowa, Minnesota and Arkansas increased production between 1996 and 2006. In 2006, Iowa raised 8.2 million turkeys and processed more than 14 million. The Iowa turkey industry employed 1,960 workers and accounted for $55.6 million in wages and salaries for processing and production in 2006. An additional 2,300 people were employed through indirect and induced activities. The industry accounted for more than $810 million in total sales and $253 million value-added activities in 2006. "Iowa currently imports nearly 6 million turkeys a year from surrounding states to support the state's two processing facilities. Because of Iowa's processing capacity, feed price advantage and ability to utilize manure nutrients effectively, there is potential to grow turkey production in the state," Lawrence, an Iowa State professor of economics, said. Increasing Iowa turkey production by 5.6 million birds to more closely match processing capacity would be expected to increase economic activity by $120 million and create 380 full-time jobs. The report found that Iowa's cost of production for live turkeys is competitive with Minnesota, North Carolina, and Missouri, the top one, two and five turkey-producing states, respectively. Iowa has higher nonfeed costs than Missouri and North Carolina due to higher facility, heating and labor expenses. However, Iowa corn and soybean meal prices are lower than these two states, making it competitive on cost of production. Although feed prices have risen with the growing renewable fuels industry, so has the cost of transporting corn from the Midwest to corn deficit regions, increasing Iowa's feed cost advantage. The turkey report is available on the Iowa State economics department website.