Column: The future is dark

The US poultry industry worked hard to forge its future. It flourished to the point that chicken meat became an inseparable part of the American diet. In line with its self-made prominence, the industry reigned in production and exports for decades.

By Fabio G. Nunes, Poultry Processing Consultant, Brazil
Along the years the industry relentlessly promoted the white meat over the other parts of the carcass to the American consumer. Using lots of creativity, the attractive, convenience-added, profitable white meat-made products, hooked the consumers while boosting companies’ bottom line. In response, white meat sales, in all forms, soared and became so valuable that it used to subsidise the remainder of the carcasses, especially the leg quarters.
Considered almost as by-products, leg quarters had no market domestically and were sold abroad for peanuts. While in Russia the “Bush legs” first arrived as a good-will gesture to further gain the status of chicken meat exports, in Latin America, their exports, were seen as a nightmare by the local industry which could not compete with them.
After years of prosperity, the sun apparently dropped over the US poultry industry in the stream of the two financial crises. The recessions they produced affected consumption habits, pushing meat consumption down by 18 pounds, five of which in chicken over the last four years. Meanwhile though, plants still operated at full (excessive) capacity.
Besides, the domestic chicken meat consumption pattern changed, pressured by growing populations of Hispanic and Asian immigrants which prefer dark over white meat. Concomitantly, Russia, about to become self-sufficient in chicken meat production, reduced US leg quarters imports, while disregard for dark meat over the years converted legs into alien items domestically. As result, offer is up and demand is down.
Good news, though. Demand for animal protein is increasing worldwide led by the increase in population and its concomitant purchasing power, mostly in Asia. Therefore, outlook for dark meat outside US is far more promising than for white meat domestically. However, instead of drowning in cheap, impersonal, leg quarters, emerging consumers expect fancy, tailor-made products.
To enter these markets and benefit from their long-term potential the US poultry industry, like Brazil, and more recently Argentina, must establish a clear, custom-driven, fancy products-geared export strategy. To achieve this, the US poultry industry will be required to use its undeniable creativity to reinvent itself to some extent over the next years. In the stream of this metamorphosis, it will realise though, sooner or later, that the future is dark!

Fabio G. Nunes

Or register to be able to comment.