How serious is the chicken shortage? It’s there, but the sky does not fall
Chicken sandwiches, chicken wings, chicken breasts, bone-in and boneless chicken.
Anything chicken can be put on a plate or in a bowl is so popular with consumers right now that demand is plaguing the industry, causing shortages of some of the most popular chicken products.
How serious is the widely reported chicken shortage?
It depends on who you talk to, but it’s a big enough concern to ruffle the feathers of consumers, producers, and suppliers in the United States and right here in Northeast Ohio.
It’s real enough to force many restaurants to cancel special chicken wing deals and scramble to fill orders for all things chicken – locally, Wing Warehouse, Winking Lizard, and a host of tavernas and restaurants. Pubs have had to cancel or adjust bone-in chicken wing specials due to limited supplies of the product. In the previous months, big brand chains couldn’t make enough chicken sandwiches to satisfy customers.
This is real enough to keep prices well above historical levels, although the price point is a matter of disputes and dueling statistics.
Data show a range of cost estimates
The US Bureau of Labor Statistics, for example, shows that the average price of whole chickens tends to decline this year from a high of $ 1.747 per pound in July 2020. In April, the bureau reported that prices had fallen to $ 1.515 per pound, still close to the pre-COVID high for this century.
Other sources dispute this estimate.
A World Bank report this month placed April whole chicken prices 78.6% higher than last April.
And US Foods, a major food supplier, reported that chicken prices were rising across the board, with wings at an all time high.
Boneless brisket, tenderloins and boneless thigh meat hit 52-week highs, according to the US Foods report from May 7, which also highlights likely price increases in June and July.
This matches the experience of local restaurant managers, who say they face a high demand for chicken products and difficulty filling orders to meet that demand.
The ‘COVID factor’ poses new challenges
Jim Callam, president of Winking Lizard’s 18 locations in Ohio, said his company’s restaurants sell about a million pounds of chicken wings a year, making it a key item on the menu.
“There is a shortage,” he said. “I saw places where there were signs saying, ‘We’re out of wings.’ “
His company was able to keep bone-in wings in stock, but adjusted the wing specials and added pizza specialties to help relieve some of the pressure, he said.
“With the COVID factor, we are selling them for takeout at a high price,” he said. “Our special offers are only for dinner.”
The company’s supplier said prices for chicken were not going down anytime soon, he said. Winking Lizard, like others in the industry, is also struggling to add workers as post-pandemic catering business expands.
“There are always challenges in our industry,” he said. “We are used to challenges.”
Jim Chakeres, executive vice president of the Ohio Poultry Association, said COVID-fueled changes in the chicken market have caused supply issues for the restaurant industry.
At the onset of the coronavirus pandemic, consumers turned to grocery stores for their chicken and chicken suppliers focused on meeting demand. As the restaurant business increases, the demand for chicken products in grocery stores has not declined.
Suppliers everywhere are facing rising production costs
In short, the demand for chickens is everywhere.
“This goes back to the start of the COVID pandemic when restaurants were closed or at limited capacity,” he said. “The production of chicken for the catering industry … has gone to retail.”
But production has not declined, he said. It simply cannot meet the demand and producers are working to increase it.
“The industry will adapt, but it takes time to build barns [and] increase production, ”he said. “There are a lot of elements that have to go into it.”
Chakeres said costs to producers have increased significantly, including labor and feed costs. The price of feed corn, for example, has increased dramatically, in part due to huge demand from China and limitations on exports from Argentina and Russia.
“Feed is the no. The cost of production and the prices of animal feed have increased, ”he said. “Corn markets are up, soybean markets are up.”
Poultry suppliers are key customers in the soybean and corn industries in Ohio
In Ohio, egg, chicken and turkey farmers use 33 million bushels of corn and 16.2 million bushels of Ohio soybeans each year, according to his organization.
After:Corn and soybean prices have peaked for several years, affecting farmers and consumers
Another representative from the supply side of the industry echoed some of Chakeres’ points.
In an email response, Tom Super, senior vice president of communications for the Washington, DC-based National Chicken Council, said chicken production was increasing.
Broilers (raised for meat) were down 4% in the first quarter of 2021, pounds produced down 3%.
“But production started to pick up at the beginning of April and we have seen an increase in production over the last month,” Super said.
According to US Department of Agriculture data, broilers produced in the week ending April 10 were up 4% from a year ago; the week ending April 17 up 9%; the week ending April 24 up 7% and the week ending May 1 up 2%.
“So yes, the supply is a little tight, but the sky is certainly not falling and production seems to be skyrocketing,” he said.
Quest for Chicken Sandwich Superiority Drives Demand
Super so called wings and boneless, skinless chicken breasts are the two most popular cuts right now, with other factors driving increased demand.
“The ‘chicken sandwich wars’ have undeniably led to an increase in demand for breast meat,” he said. “And with restaurants reopening as restrictions begin to lift, chicken processors have had to adjust their product lines and supply chains to return to a more ‘normal’ mix of retail and foodservice. . “
The demand for chicken wings in restaurants reached sky-high levels at the start of the pandemic and has remained there.
“At the end of the day, the demand for the wings has been and remains high,” he said. “Each chicken has only two wings, and producers don’t raise chickens just for the wings, they have to sell all the other parts as well.”
Brain Canale, co-owner with his wife, Carol Canale, of Whitehouse Chicken in Barberton, said the supply and pricing issues go beyond the wings.
Navigate the market supply and price fluctuations
In a recent phone interview, Canale said prices from its suppliers jumped 20% in a week. Like others, he attributed the supply issues to a host of issues, many of which traced back to COVID restrictions.
“It’s a living creature, and they have to be incubated, hatched and grown,” he said. “They can’t speed up the process. Moreover, they also have a labor shortage like everyone else. They can’t prepare at full capacity because they don’t have the staff. “
Canale said he had been able to meet demand, but was busy doing so.
“We have to be nimble,” he said. “If you had two or three deliveries a week, maybe ask for five or six.”
Canale said it juggles multiple vendors to ensure a constant flow of product. White House Chicken is trying to soften the blow of price hikes with promotions.
Canale said the market supply and price adjustments are a challenge, but not overwhelming.
“It’s more boring than anything else,” he says. “Basically you order 100 books and you get 70.”
Canale said chicken deliveries have become a cause for celebration in their business.
“It’s like [getting] Rolling Stones concert tickets, ”he said.
Leave a message to Alan Ashworth at 330-996-3859 or email him at [email protected] Follow him on Twitter at @newsalanbeaconj.