NASHVILLE, TN (RFD NEWS) — A proposed USDA poultry payment rule could change contract broiler pay, but Alabama Extension professor Dennis Brothers says the financial impact would not be the same for every grower.
The rule would amend the Packers and Stockyards Act and require poultry companies to change how contract growers are paid. Integrators could no longer use negative performance-based adjustments that reduce grower pay.
Instead, growers would receive a guaranteed minimum base pay rate, regardless of individual farm performance. Companies could still offer positive incentives, but they would not be required to do so. Although the rule was originally scheduled to take effect on July 1, 2026, implementation has been delayed until at least December 31, 2027.
Brothers compared two farms over 17 flocks using a flat $7.45-per-hundredweight base rate. The lower-performing farm would have gained 2.9 percent in revenue, while the higher-performing farm would have lost about 1.4 percent.
The results show why growers may view the proposal differently.
Farm-Level Takeaway: A guaranteed base pay system may improve revenue stability for some broiler growers, but stronger-performing farms could lose incentive-based income.
Tony St. James RFD News Markets Specialist
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