March 2, 2007

US chicken companies cuts back on production, higher prices expected
 

US chicken production would be 4.1 percent lower than a year ago, US analysts estimated.

Due to the shorter life cycle of chickens, producers have the ability to adjust production faster than other meat producers.

Already, figures from the latest available year-to-date total, at 5.812 billions pounds, show that chicken production is around 240 million pounds less than a year ago.

Reduced production is one of the reasons chicken prices are now almost 20 percent higher than that a year ago, analysts noted.

This meant about US$100 million in increased revenue for the chicken industry per week, which would help chicken producers defray increased feed prices.

However, higher prices for chickens also meant a move away from eating chicken to other meats such as pork on the consumer end, analysts said.

However, global chicken production would be cut back. As chicken supply decline and prices move higher, pork prices would be influenced as well.

Lower supply coupled with higher demand from a consumer base in a sound economy would mean higher prices for most meats, the analysts concluded.