Pilgrim's Pride announced yesterday plans to idle two of their chicken processing facilities. A chicken processing plant in Clinton, Ark. and a further-processing facility in Bossier City, La. are slated to be closed eliminating approximately 600 jobs. The stated reason for the closures was an oversupply of chicken and high feed costs.
An oversupply of chicken on the market has been cited by the company before but this press release contains some additional information just how badly this oversupply is hurting chicken prices.
The company attributed today's announcement to the continued imbalance in supply and demand in the U.S. chicken industry, which has led to market prices for breast meat that are unusually weak for the peak summer grilling season. Market pricing for breast meat is currently at $1.33 per pound, well below the prior five-year average for August of approximately $1.63 per pound, and significantly below the average price of more than $1.80 just four years ago.
And of course they had to take a shot at ethanol for pushing up corn prices but ethanol has nothing to do with management decisions by Pilgrims Pride and other chicken producers that has created this oversupply of chicken.
Source : Pilgrim's Pride