Poultry production rationalisation sweeps through the US

Pilgrims Pride, holder of 24% market share of US poultry production is teetering on the edge of bankcruptcy. Having defaulted on covenants they now seek to renegotiate. The share price has been hard hit falling to $3.13 down $10.26 from late September.

US poultry production is on a wave of rationalisation following a period of narrow margins. Hatchery production of chicks for meat production is currently down 11% from the same period last year.

Tyson, the 2nd largest poultry producer, is increasingly looking East. Their joint venture with the Indian agribusiness company Godreij Agrovet Ltd is progressing receiving further investment. Meanwhile Tyson seeks to close a number of similar deals in China this year.