August 14, 2007

Higher grain prompt French chicken firm to raise prices

French chicken processor DUC, a leading poultry company in the country, is now planning to raise prices for its entire range of poultry products

The move was made due to soaring grain prices, a senior executive said on Monday (Aug 13).

Wholesale buyers and distributors would pay between six and eight percent more, Joel Marchand, general manager, said.

DUC already raised prices in the second quarter of the year by around five percent, due partly to higher costs for breeders, he said. 

The price increase this time was due to the sharp rise in grain prices, he said. Grain prices have risen 70 percent since April, he added.

Despite the price increase, DUC still absorbs some of the extra costs. Without the move on the part of the company, prices would have risen between 15 and 20 percent instead of the six to eight percent seen now, he added.

Marchand expects distributors would pass at least some of the costs to consumers and the impact would definitely would be felt by consumers.

Higher grain prices have sparked price increases from food companies in Europe.

French company Danone recently announced plans to increase prices for its dairy products by 2.5 percent to help offset higher inputs. Others such as Unilever and Cadbury have made public statements about the rising costs of raw ingredients such as milk and grains.