US poultry farmers reeling on high costs amid financial crisis

Consumers in the US may be eating chickens more than any other meats, but poultry farmers are struggling to cope with production costs and the ongoing financial crisis.

 

Chicken producers are still hurting from last summer's record high corn prices of US$7.50 per bushel, and record prices for fuel and changes in international trade, according to John McKissick, director of the University of Georgia Centre for Agribusiness and Economic Development.

 

Consumers have also stopped eating out as much and chicken demand fell, said Richard Lobb, spokesman of the National Chicken Council.

 

About 45 percent of US chickens are sold in restaurants.

 

By the end of 2008, US poultry producers had reduced their monthly output by about 10 percent, said Lobb.

 

Large companies were not immune, as Texas-based Pilgrim's Pride - the largest poultry producer in the US - filed for bankruptcy after losing US$1 billion in 2008.

 

The company produces broilers at 378 farms in Northeast Georgia, but will cut ties with 10 percent of them in February and 45 farms there will lose their contracts, said Pilgrim's Pride spokesman Ray Atkinson.

 

The decision on who to cut will be based on the farmer's past production, Atkinson added.

 

Chicken farmers have also started seeing their houses go vacant for longer periods between flock deliveries or see fewer chickens delivered in each flock early in 2008. Both decreased the number of birds raised on farms each year, which meant lesser income.

 

More chicken farmers in Athens, Georgia, are pressurised into selling their land for redevelopment in the past eight years. Chicken farmer Steve Crowe, who has been raising chickens for 30 years, said this will only put more pressure on some farmers to exit the business.