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Chickens and Eggs: Pete and Gerry’s Looks to Hatch New Partnerships

Sunday, October 06, 2013
Monroe, n.h. — Pete and Gerry’s, the large-scale organic egg producer, is looking for energetic dairy farmers who might want to give raising chickens a try.

“Hens are a whole lot easier” than getting up at 4 in the morning to milk cows, said Pete and Gerry’s co-owner and chief executive officer, Jesse LaFlamme, last week during a tour of the company’s Monroe, N.H., processing plant, a gleaming new high-tech facility belted by computer-controlled conveyors that gently move about 1 million brown eggs a day through washing and evaluation to containers that are loaded onto refrigerated trucks headed for markets from Maine to Florida.

On this day, the computers and a dozen or so workers were dealing with unfamiliar egg cartons, which were slowing the processing.

“They’re only at about 250,000. It should be up around 600,000 by now, but they’ll get it figured out,” LaFlamme said.

The factory that had been making the familiar cartons for Pete and Gerry’s and about one-third of the nation’s egg producers recently burned, forcing a change to an unfamiliar size, he said. The fire didn’t affect the familiar Pete and Gerry’s and Nellie’s recyclable plastic containers, only eggs that were being packaged as brand names for such grocery chains as Whole Foods, Costco and Trader Joe’s.

Over the last three decades, Pete and Gerry’s has grown from a mostly local operation to a multimillion-dollar producer, and the key to the company’s success is wedded to its core philosophy, LaFlamme said.

“We were a small farm that was almost put out of business by factory farming. Now we are a big operation that is supporting small farms. All of our eggs are produced on family farms under strict humane conditions,” said LaFlamme, whose family has owned and worked the land here since the late 1800s.

To save the farm four decades ago, Jesse LaFlamme’s father, Gerry, and his cousin, Pete Stanton, found a niche. They ripped out laying cages that had been installed by their fathers and made the farm cage-free. They got ride of pesticides, fungicides, antibiotics and hormones and went organic.

Since that beginning, the philosophy has been consistent — treat the animals humanely and produce cage-free organic eggs.

“Pete and Gerry’s is an example of a large-scale producer that is moving away from the industrial model of egg production, committed instead to increasing both indoor and outdoor access for its birds,” The Cornucopia Institute, a Wisconsin-based nonprofit family farm public interest group, says in its evaluation of the company. “At its New Hampshire location, the company has attached winter gardens (like a screened-in porch for chickens) to all of its organic buildings, and increased vegetated outdoor space as well,” The Institute’s evaluation says.

Pete and Gerry’s timing was good. The company came on the scene just as there was a growing nationwide recognition of the organic movement, and things went well for the New Hampshire egg producers.

Sales are expected to exceed $70 million this year, the company has 70 employees and demand is outstripping production, according to a December article on the company in the New Hampshire Department of Agriculture’s newsletter.

In 2001, LaFlamme said, “We were growing so fast that we decided that we couldn’t just keep building new infrastructure here, so we started partnering with small farms to produce our eggs.”

Today, Pete and Gerry’s works with 63 small farms, mostly in the Northeast, and the company is looking for as many as 10 new partners a year.

“We think there are a lot of dairy farmers out there who would find this more sustainable,” he said.

Former timber man and Pike, N.H., resident Randy Cassidy is one of those farmers hoping to become a partner with Pete and Gerry’s. He’s bought some land in North Haverhill and has petitioned the town to permit him to build two buildings that will house about 40,000 hens.

“That’s an animal equivalent to a small dairy farm and will have less of an environmental impact,” LaFlamme said.

Putting 20,000 chickens in a 25,000-square-foot building sounds like a lot, but the birds will have room to roam around check on others, to flap their wings and fly up to roosts. (Factory egg production facilities stack hens in cages three high and are able to get 250,000 layers in the same size building, LaFlamme said.)

The hens also have an outside yard that allows them to peck grass, eat bugs and roll in the dust, when weather permits.

The chickens nest in cubbyholes in a 300-foot double-sided line of openings with slanted floors that allow eggs to roll down to a conveyor that transports them to a collection point. (At Pete and Gerry’s Monroe farm, the egg-carrying conveyor belt runs about a mile and a half underground from the farthest hen building to the processing plant.)

The two 25,000-square-foot buildings proposed for North Haverhill would be fully automated with conveyor belts that gather the eggs to a central collection area. There is another conveyor belt system that removes manure from the hen’s living space to confined areas on each end of the building where it can be removed and sold.

“Manure is a real asset,” LaFlamme said. “It’s got value, and it’s not something that will remain in the building long or create excessive odor.”

Cassidy couldn’t be reached for comment last week. The construction of his two building is contingent on Haverhill’s zoning board of adjustment approval of his application for a special exemption to the town’s aquifer protection ordinance.

During a hearing last month, concerns were expressed about the farm’s affect on ground water, according to the weekly Journal Opinion.

The buildings proposed for Haverhill are environmentally friendly and mature is contained until it can be removed, LaFlamme said.

“It’s a matter of balancing agriculture use with the surrounding area,” he said.

Pete and Gerry’s signs a seven- to 10-year contract with the small farmers and provides them with pullets just starting to lay, feed and supervision. The farmers are responsible for providing the buildings and the equipment, which can cost close to $1 million, and managing the flock and the facility and gathering the eggs. Over the course of the contract, the company’s commitment also is about $1 million, LaFlamme said.

The farms are visited regularly to make sure company standards are maintained. If the standards aren’t met, the company takes over the operation of the facility and charges the farmer.

If the entire cost of the building is financed, a farmer could still make money — about $30,000 per building per year — and have the building paid for by the end of the contract.

The operation requires about three hours of work a day, he said.

Banks normally would lend about 75 percent of the cost of the buildings and equipment and usually with a guarantee from the U.S. Department of Agriculture Farm Services division, said Graham F. Gove, vice president and chief lending officer with Wells River Savings Bank.

Some farmers also are able to finance the equipment separately, and in Vermont state agriculture grants and loans help with the down payment.

“The sort of loans that we would make really comes down to who’s borrowing the money,” Gove said, adding that the bank had not yet financed a farmer with a contract from Pete and Gerry’s, but that two potential deals had been reviewed and another is now under consideration.

“I don’t have any experience with them because we haven’t made loans, but I do know the company and think it is something that we’d consider,” he said.

“I know they’re looking for dairy farmers, and when you have this up and running, I’m sure it beats dairy farming.”

Warren Johnston can be reached at or 603-727-3216.

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