Pilgrim's Pride, Largest Chicken Producer, Files For Bankruptcy [shenanigans]
Pilgrim's Pride, a chicken producer we've never heard of, is filing chapter 11. Despite never actually clocking in on our radar, Pilgrim's Pride
is was the number one chicken producer, and now they've been done in by ... the rising cost of chicken feed.
Intriguingly, this could be a matter of fowl play [Did you actually just type that? – Ed.] — The Big Money is calling shenanigans on rival chicken producer Tyson:
Tyson CEO Richard Bond told analysts at the time that the company wasn't about to cut back on production. "As of right now," he said, "we still believe that the demand-supply balance for us is still reasonably good."
Which is ridiculous. Every independent observer of the poultry business says there is a massive oversupply problem, which is keeping retail prices way down, and which was the proximate cause of the losses in Tyson's poultry business.
"Something weird is happening in the meat industry," observed Tom Philpott of the Gristmill blog, noting that Tyson not only didn't cut back, but actually increased chicken production in the quarter by 6 percent.
Now, I'm no agricultural economist, but maybe if Pilgrim's Pride had allocated more of their capital to the "buy chicken feed" pile, and less to the "build a gigantic scary bust of the company's founder" pile, they'd be in a more defensive position.