October 30, 2006

Pilgrim's Pride announces cut in chicken production

Pilgrim's Pride Corp., the second- largest US chicken producer, would reduce chicken processing by 5 percent by January next year under the burden of falling prices and increased costs.

This meant the company would produce 1.3 million fewer chickens a week, said Chief Executive Officer O.B. Goolsby Jr.

The company said in a statement it would remain in that lower state of production until industry margins return to normal levels.

While bird flu has lessened demand for chicken overseas, high corn prices domestically have increased costs of production, said Gary Rhodes, Pilgrim's Pride spokesman.

However, the cutback would not affect the company's current bid to buy over Gold Kist  Inc., the third largest chicken processor, Rhodes said. The company also has no plans to lay off workers or close plants, he added.