US Pilgrim pins chicken industry woes on ethanol

12 March 2008 21:48  [Source: ICIS news]

HOUSTON (ICIS news)--US chicken company Pilgrim’s Pride will close one of its 37 processing centres in the US due to soaring feed prices resulting from booming corn-based ethanol production, the company said on Wednesday.

"Our company and industry are struggling to cope with unprecedented increases in feed-ingredient costs this year,” said Clint Rivers, president and chief executive officer.

Rivers said that is largely due to the “ill-advised” US policy of providing generous federal subsidies to corn-based ethanol blenders.

The US Department of Agriculture (USDA) expects corn prices to jump by 30% to $3.75-4.25/bushel in the 2007-2008 crop year. That compares with $3.04/bushel assessed by USDA for 2006-2007.

Pilgrim’s Pride said it would also close 13 distribution centres as part of its plan to curtail losses.

The company also blamed “an oversupply of chicken” in the US for its decision to shut down the facilities. The closings are expected to be completed by June, Pilgrim said.

Pilgrim's Pride is the largest chicken company in the US and the second largest in Mexico.

For more on ethanol visit ICIS chemical intelligence

Bookmark Simon Robinson’s Big Biofuels Blog for some independent thinking on biofuels

By: William Lemos
+1 713 525 2653

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly