The nationwide chicken shortage is nothing to crow about.
Executives at Tyson Foods are blaming underperforming roosters — used to fertilize eggs — for the paltry poultry output across the U.S.
“We’re changing out one [type of] male that, quite frankly, we made a bad decision on,” Donnie King, president of Tyson’s poultry business, told analysts Monday on a conference call.
Based in Springfield, Arkansas, Tyson is one of the world’s largest poultry producers. The company said it is trying to increase supply, but the new roosters aren’t all they’re cracked up to be.
King said eggs fertilized by this particular type of rooster hatch less often. The slowdown is a bad break for Tyson as it comes with surging demand for chicken across the country.
The underperforming roosters should be replaced by fall, King added, but prolonged supply problems could linger into next year.
He explained that Tyson switched to new roosters to improve meat quality, but with fewer chicks produced, they’ve switched back to the roosters they used before.
The breeding problems aren’t the only thing pecking at Tyson’s profit margins. High demand accounts for the other half of their challenges.
“It’s about a 50/50 split between the hatch issue for us and the strong demand,” King told reporters after the earnings call, according to Reuters. “We’ll get our supply sorted out.”
Other factors choking the chicken supply include the winter storm that slammed Texas in February, “worker absenteeism” and growing demand, said Gary Mickelson, a Tyson spokesperson.
Tyson isn’t the only food producer shell-shocked by the limited supply and rising demand. Fast food executives have said pandemic safety measures have slowed production while recently released chicken sandwiches have driven demand.
KFC is releasing a new chicken sandwich to compete with Popeyes’ wildly popular version.
“Demand for the new sandwich has been so strong that, coupled with general tightening in domestic chicken supply, our main challenge has been keeping up with that demand,” said David Gibbs, CEO of KFC owner Yum Brands, last month.
KFC is not the only restaurant chain struggling to keep up. Wingstop, Bojangles and Buffalo Wild Wings have all reported short supply.
Source: NY Post
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