Poultry producers hit by rising corn prices

Scott Tong Nov 21, 2011

Jeremy Hobson: We’ll get earnings this morning from Tyson Foods.

And don’t expect much — because as Marketplace’s Scott Tong reports, this economy has not been good for the poultry industry.

Scott Tong: Chicken producers aren’t giving thanks this year. At least four went bankrupt, and even industry giant Tyson Foods predicts losses. Blame it on paltry poultry fundamentals: costs of feed like corn are up. And in a soft economy, sales of the big moneymaker — boneless, skinless breast — are down.

Economist David Harvey is with the U.S. Department of Agriculture.

David Harvey: When people are stressed economically they’re going to be moving down the buying chain, you know, and substituting less expensive products for more expensive products.

The price of white meat at the wholesale level has fallen 17 percent last year. But there is hope. Early signs suggest prices are rising again, as big chicken companies cut supply.

Harvey: Five, six, seven percent below the previous year. So we’re definitely seeing less chicks being placed for growout.

Oh, and if you’re still shopping for Thursday, consider chicken. The Farm Bureau says everything else — pumpkin pie mix, sweet potatoes, turkeys — has gotten pricier.

In Washington I’m Scott Tong for Marketplace

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