October 9, 2006

Heads of US chicken industry outline future challenges

Chicken feed, bird flu, domestic and international poultry demand were the greatest concerns on the minds of the top four honchos of the chicken industry at the annual National Chicken Council¡¯s annual conference in Washington, DC last week.

With the country's increasing reliance on ethanol and as the competition for corn supplies hots up, a drought in the corn belt could devastate the poultry industry more so than the ethanol industry, Gold Kist president and CEO, John Bekkers pointed out.

Since it would be easier for energy producers to find alternative energy crops than for poultry producers to find alternative diets for their chickens, he suggested that corn for ethanol should be replaced by less expensive alternatives, such as sugar cane.

Bird flu and the continued unquestioned safety of US poultry is another future challenge that the poultry industry must overcome, Lampkin Butts, Pilgrim's Pride president and CEO said. Butts also remarked that continued testing and biosecurity programmes are the key to the industry's development. However, he suggested that the US still has some catching up to do as it still lags behind a number of other countries.

Tyson Foods, the top chicken processor in the US, worries about maintaining the US's competitive advantage in an increasingly global marketplace. Senior group vice president of poultry and prepared foods for Tyson Foods, Bill Lovette, said the transparency of the regulatory programmes is one of the best ways of doing this. In a veiled reference to the multi-million dollar losses incurred by chicken companies due to bird flu overseas cutting down on international poultry demand, he said that companies should look for ways to reduce reliance on exports to reduce their risk exposure.

Growth in domestic demand and new products are tops on the mind of Sanderson Farms president O.B. Goolsby, who noted that the average American eats 87 pounds of chicken a year, up significantly from decades ago. Goolsby said the challenge is to see consumption growing and innovative new products would show the way to that growth.