Chicken prices on the rise

Chicken prices on the rise
(MEATPOULTRY.com, February 06, 2009)
by MEAT&POULTRY Staff
http://www.meatpoultry.com/news/daily_enews.asp?ArticleID=99875&e=ghuerto@gmail.com

WASHINGTON – Since last summer, the U.S. poultry industry has been in a contraction phase as higher feed costs, over-supplies of broiler meat, as well as the deterioration of domestic and foreign markets have pressured wholesale poultry prices and left the industry struggling to preserve any type of profit margins, according to the Livestock Marketing Information Center.

As a result of significant industry cutbacks in eggs set and chicks placed as well as the hatchery flock, the available supply of broiler meat on the market has started to decline dramatically and broiler-meat prices, especially breast-meat prices, have started to increase.

Weekly prices for skinless, boneless breast meat in 2008 averaged about $1.29 per lb., 12% or 0.18 cents per lb. below 2007’s and 10% lower than the 2002-2006 average. Although boneless, skinless breast prices started off 2008 rather strong, reaching a weekly high price of $1.54 per lb. in May, by mid-summer boneless, skinless breast prices crumbled and fell to a weekly low of $0.98 cents per lb. in November. Prices have improved since then as the effects of much tighter supplies have taken hold.

At the onset of January 2009, weekly breast meat prices were at $1.18 per lb.; by the last week (weekending January 27th) prices had jumped to $1.31 per lb., 3% higher than the same week last year and a three week gain of about $0.13 per lb. In fact, it is the first yearly increase in weekly breast prices since last February.

Broiler meat prices are forecasted to generally increase looking forward due to tighter supplies however prices for export items such as legs and thighs might not benefit as much as breast meat prices. U.S. broiler production for the first quarter is forecast to be down 6% from a year ago. For the year, U.S. production is expected to be down 4% to 5% and the smallest since 2006.