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Shares in the second-biggest US chicken producer surged as much as 9% on Thursday, the most in intraday trading since April. The gains came even as a glut in supplies pinched Pilgrim’s fourth-quarter earnings, released late Wednesday.
While chicken supplies expanded more than sales in late 2022, resulting in an “unprecedented decline” in prices, the industry is positioned to benefited from a shrinking US cattle herd. That will likely make steaks and hamburgers more expensive in the next few years.
Even chicken wings — one of the first foods whose prices surged during pandemic-era supply-chain gyrations — are seeing rising demand. Wing prices dropped 22% from a year ago ahead of Sunday’s Super Bowl, according to Wells Fargo’s Agri-Food Institute.
“Given this decline and extended period of relative low prices, now more operators are purchasing wings to support their menus,” Pilgrim’s Pride Chief Executive Officer Fabio Sandri said on an investor call Thursday.
©2023 Bloomberg L.P.
