12.00 



10.00 



800 



°-6.00 



o 

 o 



4.00 



2.00 



Figure 9. Total Average Cost per Ton of Feed Manufacturing 

 and Distribution with Feed Distributed at Three Density Levels 



31 tons per square mile per year 



6.55 tons per square mile per year 



32.73 tons per square mile per year 



10 20 30 40 50 60 



Thousonds of tons per year 



70 



80 



90 



duces 45,287 tons of manufactured feed a year and distribute? into an 

 area with a radius of 46.9 miles. This output is sufficient to produce 10.4 

 million finished live broilers (36.4 million pounds) annually and to 

 keep a processing plant with a line capacity of 5,000 broilers per hour 

 operating at its designed output on a single shift basis throughout the 

 year.- 



Manufacturing and distributing feed at the highest density level 

 considered results in a decreasing total average cost over the entire range 

 of firm sizes considered. The cost per ton decreases from S 10.50 for 

 Firm A to $6.24 for Firm F. Firm F produces 90,577 tons of finished feed 

 a year and distributes into an area with a radius of 29.7 mile?. The feed 

 volume is sufficient to grow out 20.8 million finished live broilers (72.8 

 million pounds) annually.^ This volume of broilers will keep a pro- 

 cessing plant with a line capacity of 10,000 broilers an hour operating at 

 its designed output on a single shift basis throughout the year. 



1. Long-Run Changes — The effect on total average cost from long- 

 run changes in mill size and output and density can be determined from 

 the data in Table 22. Increasing density from the 1.31 to 6.55-ton density 

 levels requires an increase in mill size and output from 32,609 to 45,287 

 tons a year and reduces the average manufacturing cost by S.55 a ton. 



- The feed manufacturing and distribution cost for Firm D 

 cents a pound of finished live broiler. 



3 The feed manufacturing and distribution cost for Firm F 

 cents a pound of finished live broiler. 



is equivalent to 0.97 

 is equivalent to 0.78 



50 



