“But we started asking questions and we went to the meetings, and as we learned more, everything was very positive.”“If you just read what’s on the internet you might be pretty nervous about doing this,” Debbie added. A number of high-profile outlets have reported on the better than other retailers, and working with unions rather than against them—is doing it differently.“When people talk about poultry they tend to base their opinions on the way the industry has been traditionally in certain parts of the country or with certain companies,” says LPP spokesperson, Jessica Kolterman.
Instead, she says LPP intends “to treat our growers as partners in a long-term relationship as opposed to someone who’s more of a traditional contractor.” Kolterman points to the fact that LPP is offering a 15-year contract for starters.
In 2014, Costco reported selling 78 million of these processed, four-pound birds a year.
In order to guarantee a steady supply and maintain the price, Costco fixed its eye on Nebraska as the best place to start raising and processing its own supply of chickens, and “break free of the monopoly” held by companies such as Tyson and Pilgrim’s Pride, much like it did for sausage and hotdogs with its Kirkland plant in Tracy, California.
”The Farmers Lincoln Premium Poultry has been recruiting farmers for the last year and a half.
The company is tight-lipped about the actual number they have signed on so far, but in a state where row crops—corn and soy—dominate the landscape, and most small-scale livestock production left decades ago, LPP says bringing poultry back has the potential to help a new generation of farmers return to their family operations. They have three barns under construction in Allen, Nebraska, and they’ll be getting their first shipment of pullets next April, just a week before Hannah, 21, graduates from the University of Nebraska.
Married to the Barns Hansen has seen early versions of the contract LPP is offering farmers but says the company has resisted sharing newer versions with him in recent months.
And while he and others have offered information sessions from farmers and experts on poultry over the last year, he says it seems to make little difference.“[Costco and LPP] like the idea of having folks that don’t have any real background or experience with these issues.
Very few farmers use lawyers, he adds, and the odds of finding a lawyer in Nebraska with any experience in poultry contracts are slim to none, so they’re “at a huge competitive disadvantage.” The contracts themselves, he adds are offered on a take-it-or-leave it basis.In June, the company broke ground on a giant new poultry processing facility in Fremont, about an hour west of Omaha.The plant will process more than 2 million chickens a week, or more than 100 million birds a year, and provide as much as 43 percent of Costco’s rotisserie chickens, as well as around one third of the raw birds it sells.Kolterman also likes to point to the way people do business in Nebraska—based on what she calls, “relationships that transcend business.”And while Costco clearly has its reasons for bringing the first large-scale poultry operations to Nebraska—such as relatively abundant sources of water and corn, as well as a population that is literally and physically removed from the negative experiences other farmers have had in the industry—it’s clear that LPP is also under a lot of pressure to get the operation up and going, without any back-up production.
“We’re only building enough barns for what we need; we’re in a different situation than any other place where there’s a lot of poultry,” said Kolterman. That’s the question at play in Nebraska, where Costco, one of America’s most powerful companies, has the potential to impact residents, farmers, and the environment in complex and unprecedented ways.