Poultry industry flying high
Oct. 12, 2017
by Joel Crews
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Mike Donohue, vice president of Agri Stats Inc., discusses Marel's success in the poultry industry.
LENEXA, Kan. – Mike Donohue, vice president of Agri Stats Inc., Fort Wayne, Indiana, attributes the ongoing success of companies in the poultry industry to several factors, not the least of which is the sustained growth in demand for products carrying the “no antibiotics ever” (NAE) claim.
“…Up to 42 percent of the chickens are fed NAE right now,” he said, adding that this number was between 3 percent and 4 percent just four years ago. Donohue’s poultry-focused presentation was part of Marel’s unveiling of its Progress Point Demo & Training Center and its Poultry Showhow customer event, held Oct. 10-11 in Lenexa, Kansas. Donohue was one of several speakers to address attendees about industry trends and new technologies during the event, which included a full slate of equipment demonstrations.
Donohue applauded poultry processors for creating more demand for their products and charging a premium for breast meat and especially for wings. “We’ve got the best wing prices we’ve ever seen for the last couple of months,” he said, adding that what used to be a Super Bowl-dependent item has become a year-round staple at foodservice and retail. In the aftermath of what was a global outbreak of avian influenza over the past 24-plus months, even chicken leg-quarter demand has rebounded in most markets with prices that are favorable to the poultry industry.
“You’ve been successful in delivering products that people around the world realize have value,” he said.
Addressing processors’ reaction to market hiccups and changing consumer demand, Donohue acknowledged how companies have responded to challenges by improving evisceration systems, chilling systems and adding automation to the manufacturing process, which has improved efficiencies, lowered costs and added value. Among the biggest of current challenges facing the entire industry is the labor shortage, said Donohue, which is a well-known fact by those in attendance.
In terms of today’s plant types where poultry is processed, Donohue shared a chart indicating the three most common are tray-pack facilities, with about 27 plants, those processing exclusively for the fast-food sector, at about 35 plants, and big-bird deboning facilities, which numbered about 27 in 2001 and have grown to about 42 plants.
Pounds of poultry have increased dramatically along with the growth in big bird weights, Donohue pointed out. In 2000 a big bird weighed about 6.25 lbs., compared to upwards of 10 lbs. today and it isn’t uncommon for these plants to produce upwards of 80 million lbs. of poultry meat per month.
Meanwhile, tray-pack processing plants are operating in one of two segments: the higher-priced, NAE-type of products using birds just over 6 lbs., or the more commodity-based tray packed facilities, where non-NAE products are made using birds that are in the 7-lb. range. “They are looking for family-pack, tray-pack business that are lower priced and are targeting different consumers,” said Donohue.
In terms of yield, processors are becoming much more efficient while bird weights increase. In fact, he said, “Last week, for the first time in history, the average eviscerated sold yield according to Agri Stats went past 80 percent.” Donohue contrasted that yield with 20 years ago when yields hovered just under 70 percent, “which means we’re adding a half-percent of yield per year,” he said.
While animal disease, trade issues, labor shortages and unforeseeable market hurdles are bound to test processors again in the future, the poultry industry is riding a positive wave everyone hopes will continue, Donohue said. In the future, “our challenges are going to grow, but having been in this industry for 37 years, I have no doubt we are going to succeed in finding the solutions moving forward.”