Analyst Predicts TrendsWed, 27 Oct 2010 18:00:33 CDT
Agribusiness and food industry analyst Heather Jones says soaring feed costs have erased profit prospects for U.S. pork and poultry producers next year, curbing expansion plans and likely forcing a cutback in chicken production. But, the decline in chicken production may provide a boost for beef and pork producers, reducing supplies of cheaper meat that could hurt demand for pricier steaks and chops.
According to Jones, pork producers probably will - halt their expansion and potentially return to contraction mode - returning profitability to solid levels. At the same time chicken producers are expected to lose money next year, which probably will stall the industry’s recent expansion. And Jones expects chicken prices to -come under significant pressure - in mid- to late-November and December.
Beef and pork producers may still find support by tight supplies and strong exports that could keep prices high next year.
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