Americans are eating more chicken and paying more to do so, according to leading poultry producer Sanderson Farms.
The company said its third quarter sales increased 18.3% to $739 million and profits grew 136% to $67.9 million, or $2.95 a share, compared to profits of $28.7 million, or $1.25 a share.
The strong showing was the result of improved market conditions as whole bird prices remained at historically high prices during the quarter, according to Joe F. Sanderson, Jr., chairman and CEO of Sanderson Farms, Inc.
“In addition, market prices for wings, while below last year’s third quarter levels, improved during the quarter,” Sanderson said. “Boneless breast meat prices remained well above last year’s prices and peaked in May as several quick serve restaurants and other food service establishments featured chicken on their menus.”
The positive report from Sanderson followed the release earlier in August of favorable results from Tyson, the nation’s largest protein produce. The company’s chicken segment was its strongest performer, with sales up 10.6% to nearly $3.2 billion, driven by a combination of 4.4% volume growth and a 6% increase in prices.
Sanderson noted wide swings in prices for different parts of the chicken. For example, boneless breast prices this year are 32.3% higher than last year, while jumbo wing prices are 19.3% lower and leg quarter are essentially flat.
The big variable for Sanderson and Tyson during the coming months is whether ideal growing conditions so far this year produce a much anticipated bumper crop of corn and soybeans, resulting in lower commodity costs for the chicken producers and potentially higher margins.