CROSSFIELD, Alta. – After 30 years of repairing cars in their Calgary auto body shop, Ron and Dawn Smith never dreamed they would become farmers.
Today, the Crossfield couple head an enterprise called Rhea Grande where they raise rheas as part of a thriving cosmetic business.
Six years ago they were city slickers who knew little about agriculture, but they were willing to learn. They bought rheas to help pay for feed for their horses and goats, with the dream they would make their fortune selling rhea breeding stock. They soon realized that idea was going nowhere.
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“There’s got to be a reason to be raising them. You can’t just keep raising these animals and have them running around with no place to go,” said Dawn.
The Smiths investigated processing the birds and found almost no one was marketing them. Ron says this is a problem within the entire ratite industry.
“If they start marketing the product like they should, they’d run out of product because they don’t have enough birds,” Ron said.
The Smiths’ marketing angle is a skin care line with 10 different products made from rhea oil.
They feel too many products are produced at a cottage industry level and the quality is not good enough for sophisticated consumers in Canada and abroad.
“Rather than going the Mickey Mouse route like everybody else, we went to the federal government and it took nine months for them to approve the use of rhea oil in the skin care products,” said Ron.
The oil-producing rheas for their operation are raised on 70 farms in Western Canada, with the Smiths contracting the stock.
The birds are then bought back by the Smiths, who arrange to have them processed. The oil goes to a skin care manufacturer in Vancouver where it is refined and blended with other products like aloe or glycerin to make skin moisturizers, body washes, shampoos and facial cleansers.
Last year the Smiths bought back 350 birds from contracted farms and expect to take 500 this year. Half were sold for breeding and the rest were processed. This year they expect 40 percent will be sold for breeding and the remainder will be processed. Breeding birds sell for around $1,500.
Using money they made from selling breeding stock, Rhea Grande paid the development costs for each moisturizer formula. Each cost $10,000 to develop and makes no claims about medicinal properties.
Each rhea produces about 2.25 kilograms of fat, which yields about one litre of odorless, clear oil that doesn’t go rancid.
One litre of oil can produce $1,750 worth of skin care products.
The product is sold through trade shows, home parties and other venues. Last year the Smiths traveled 100,000 kilometres hauling birds to farms and visiting 20 to 30 trade shows to promote the moisturizers. The hand cream is the best seller at about $15 per unit.
Most earnings are derived from the skin care products. The money is split among the sales people who receive a 35 percent share of the retail price. The manufacturer takes 30 percent, five percent goes to Rhea Grande, and other returns are used to pay for shipping, insurance, publicity and buy backs on birds.
Sales of the skin care products have increased substantially each month but the Smiths admit the market is still small and they don’t expect to get rich quickly.
They have also found smaller markets for meat and leather.
The meat is made into pepperoni, sausage and jerky at $3.50 a pound wholesale. They don’t want to compete against beef and two years from now plan to see the meat turned into a specialty dog food.
The hides are sold as luxury leather items such as handmade wallets or boots. This year the Smiths received an order from Italy for 500 hides and hope the customer can wait until they gather that many.
By building strategic alliances with farmers, processors and a cosmetics manufacturer, they are slowly building a market. They warn their farmer-contractors that this is a long term commitment, and that not every chick will survive. Ten chicks per hen per year is acceptable.
The company has 12 regional managers. The 70 farmers work under the regional managers, who help market the lotions and provide support for raising the birds properly.
For most producers in their network, rheas are still a sideline. Some are acreage owners hoping to make money off their small holdings, while others are larger, traditional farmers who know how to handle livestock.
Members in the group help each other with production problems and have found a few veterinarians who are developing expertise in the care of these exotic birds.
