Broiler production is a long-term commitment-houses are
expensive, built to last for many years, and have few alternative
uses. Because of that, producers tend to have long-term
relationships with those who purchase their product (referred to as
'integrators' when broilers are raised under contract). On average,
producers reported holding contracts for 13 years with their
current integrator in 2006. However, the actual contracts often
specify very short durations. Forty-five percent of producers
reported that their contracts were flock-to-flock, explicitly
covering only the birds currently in their houses (5-10 weeks).
Only eight percent of production contracts specified a term of at
least 7 years, while the longest ran 15 years. Long durations tend
to be offered to newer and larger operations. Among recent
entrants, those with long-term contracts averaged half again as
much production as those with shorter contracts. This chart
appeared in The
Economic Organization of U.S. Broiler Production, EIB-38,
June 2008.