Chicken Run at Supermarkets Has Processors Boosting Output


Lydia Mulvany, Isis Almeida and Ed Ludlow, Bloomberg

via Yahoo Finance - March 17, 2020


(Bloomberg) -- Meat companies are ramping up processing to help restock coolers that are being emptied by Americans on edge because of the spreading coronavirus.


Tyson Foods Inc., the biggest U.S. meat processor, is making its “most-significant shift” ever to produce more chicken, beef and pork that’s favored by supermarket shoppers, rather than cuts that restaurants use. Employees are working through weekends to fill as many orders as possible.


Sanderson Farms Inc. said it is adding Saturday shifts at its five plants that process chicken for grocery-store customers, and is ready to convert two other plants to process more such birds. Pilgrim’s Pride Corp. and Perdue Farms Inc. are also working to accommodate the boom in retail demand.


As U.S. restaurants shutter amid efforts to stop the spread of the coronavirus, consumers are rushing to grocery stores to stock up on food and other staples. Fresh meat, along with dry and canned goods, toilet paper and hand sanitizer are among items that haven’t been restocked as quickly as they’ve been sold.


“Food stores in our tri-state area have been cleaned out of all poultry-related products due to the ability to freeze them,” said Brian Williams, senior vice president at Macquarie Group Ltd. in New York. “Product lines in the poultry space are being diverted to retail in lieu of restaurant capacity.”


The shift is important because 60% of Sanderson Farms’ business is focused on food service. On a call last week, Chief Executive Officer Joe Sanderson said the retail business is “extremely strong,” with the company “pretty well sold” at most of its plants.


Meat processors are also adding extra weekend shifts to get ahead of what might become a labor shortage at plants, said Russ Whitman, senior vice president at commodity researcher Urner Barry.


With the likelihood that school closures force some plant workers to stay at home, labor concerns are growing. The U.S. Department of Agriculture on Monday said plants will continue to operate staffed with federal inspectors...