May 26, 2006

Benefits from fall in chicken prices elude consumers

While poultry processors are getting the lowest prices for chicken from producers in decades, retail prices have not been falling on the same scale, said economists.

The price charged by processors for whole broilers and leg quarters is lower by 19 percent and 36 percent respectively, compared with prices a year ago.

However, retail prices have slipped just about 1 percent from last year, according to forecasts by Agriculture Department economists.

In many supermarkets, prices have remained the same. The National Chicken Council, the trade group representing processors said they do not comment on retail prices.

However, livestock analysts think if retail prices had dropped as much as the prices processors paid for chickens, it would have increased demand enough to help reduce the oversupply situation.

Most US supermarket chains have remained tight-lipped about why prices have remained pretty much the same when raw chicken prices have fallen significantly. Fast-food chains, where prices for chicken products have remained much the same have also preferred to shy away from commenting.