Chicken prices set to skyrocket

The Australian Chicken Meat Federation (ACMF) has warned that consumers can expect a significant price increase on chicken meat in mid-November, due to a continuing shortage of grain.

Over the past six months, the continuing global grain shortage has led to unprecedented prices for feed grains. The price of a tonne of wheat, the industry’s single biggest input cost, has more than doubled in a year and hit a new high this month of $492.

Grain represents the major part of chicken feed and the recent increase in feed costs alone translates into cost increases in excess of 20-30%.

“The two predominant grains in chicken feed, wheat and sorghum, account for approximately 70% of the feed, with other grains, protein meals, fats, vitamins and minerals making up the balance,” said Dr Andreas Dubs, executive director of the Australian Chicken Meat Federation.

“With the unprecedented rise in the cost of grain, chicken producers are finally being forced to pass on these costs to the consumer.”

The ACMF said the industry has also been struggling with rising petrol and electricity costs. Fuel has continued to rise from an average 115c per litre in November 2006 to 125c per litre in July 2007 and electricity costs have almost doubled.

Consumers are likely to be paying an average of 20-30% more for chicken meat, from whole chickens right through to further processed products.

“The facts speak for themselves: with such substantial and sustained increases in the cost of grains and other inputs, the forthcoming price increase is simply inevitable,” said Dubs.

The ACMF stresses the price of chicken still remains affordable, compared to other meats, since its price has remained relatively constant for over a decade.