ing and equipment specifications and costs were obtained from engi- 

 neering and equipment manufacturers. 



Procedure 



Eight model plants are developed and short-run average cost curves 

 determined for comparisons to illustrate the economies of size in feed 

 manufacturing. The volumes of these plants are based on the total feed 

 requirements of eight coordinated firms that produce broilers and hatch- 

 ing eggs under contract along with such other activities as processing and 

 hatching (see Appendix A). The capacity of the final activity stage in 

 the firm, processing, establishes the capacities and volumes for all other 

 activities. Processing capacities considered for this analysis are: 600, 

 1,200, 1,800, 2,400, 3,600, 5,000, 7,500 and 10,000 of 3.5 pound live birds 

 per hour for eight hours a day, 260 days a year. ^ 



The feed volume required of each mill is derived from several input- 

 output relationships and accepted feeding practices. ^ Each mill manu- 

 factures a total of five basic formulations, two for broilers and three for 

 breeders producing hatching eggs.^ It is assumed that each mill pro- 

 duces a given quantity of each formulation each day. The total daily 

 tonnage is manufactured in an eight-hour day and operations are con- 

 ducted 260 days a year. Table 1 gives the tonnages manufactured per day 

 by formulation and form. 



Table 1. Volumes of Feed Manufactured per Day 

 by Formulation and Form for Eight Model Mills 



Breeder§ Mash 2.46 4.93 7.39 9.86 14.79 20.54 30.81 41.08 



Total tons per day 20.9 41.8 62.7 83.6 125.4 174.2 261.3 348.4 



Total tons per year 1 1 5,434 10,868 16,302 21,739 32,609 45,287 67,933 90,577 



Coefficients Used 



* 2.87 pounds per finished broiler + 14.0 pounds per breeder started 



** 4.48 ponnds per finished broiler § 8.5 pounds per dozen hatching eggs 



t 6.0 pounds per breeder started needed. 



1 1 260 day year 



1 These processing firm capacities were developed in G. B. Rogers and E. T. Bard- 

 well's Marketing New England Poultry: 2. Economies of Scale in Chicken Process- 

 ing, University of New Hampshire, Agricultural Experiment Station Bulletin 459, 

 April 1959. However, in that report the processing firms were operated only 247 days 

 per year. 



2 See Appendix A for the coefficients and method used in developing feed volumes 

 manufactured by each model. 



3 See Appendix B for feed formulations. 



