US: Poultry industry cuts output to control costs

By just-food.com | 9 October 2008

Poultry production levels have reached a five-year low as the struggling US poultry industry reduces output in a bid to control spiralling costs, the National Chicken Council told just-food today (9 October).

High feed costs and low selling prices have hit the chicken industry and led to calls for production cuts.

"Companies are responding to the high price of grain by trying to control costs," NCC communications director Richard Lobb said. "Feed prices are very high and now account for about two-thirds of the price of raising a chicken."

The number of eggs that will hatch meat-producing chickens was down 11% last week from a year earlier at 188.985m, the US Agriculture Department revealed.

In May, the USDA predicted that the utilisation of corn for feed would drop by 14% year-on-year. "If you have less feed you will have fewer animals," Lobb said.

However, Lobb warned, production cuts will not necessarily result in higher selling prices.

"It is still a very competitive market. There is a lot of product on the market and not all companies have cut production. Production cuts are really about getting costs under control," Lobb said.

Sectors: Meat & poultry, Seafood