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Chicken Wings Shine in Today's Tough Economy
11/20/09
Chicken Wings Shine in Today's Tough Economy
In today’s tough economy, it’s difficult to predict the next big restaurant trend since folks are eating out less, which makes it particularly challenging for the poultry industry to plan for the future.
In the early 1990s, steakhouses such as Outback were the hottest trend, while later that decade, casual dining spots such as Chili’s, Applebee’s and Ruby Tuesday’s were the trend setters. This bodes well for poultry producers since chicken is often the meat of choice for patrons of casual dining. For most of this decade, ethnic eateries were the hot trend, although steakhouses and casual dining spots still fared well.
Since the economic downturn, all foodservice establishments have seen declines, but casual dining has suffered the most, which has put a real crimp on sales of chicken breasts, a longtime restaurant staple.
“These days it’s a real challenge to forecast the real growth area in the restaurant business. It really is hard to pinpoint what the next big thing is,” said Scott Brown, a livestock and dairy economist with the Food and Agricultural Policy Research Institute at the University of Missouri.
Brown was on the program of Farm Bureau’s commodity outlook conference held in Albuquerque, N.M., Oct. 15-16. He said the big drop in foodservice demand has been particularly hard on poultry producers.
The recent news of restaurants shifting from chicken wings to “boneless” wings due to the big fall in chicken prices illustrates the tough times facing the poultry industry today. In seven of the last 11 months, wholesale wing prices have been higher than breast prices, a reversal in the market where breasts usually reign supreme. In September, the average wholesale price for whole chicken wings was $1.48 a pound, according to the Agriculture Department, while skinless boneless breasts were $1.21 a pound.
Demand has been stronger for chicken wings because people often look at them as a cheap luxury. The New York Times reported Oct. 13 that the recession has been a boon for many wing restaurants because many perceived them to be an affordable luxury.
Wing prices are expected to remain strong for the rest of football season until the Super Bowl in February when most wings are sold and prices peak. Still, demand is expected to remain strong for wings for the long haul. One big boost is the decision by Pizza Hut to expand the availability of its wings menu, called “WingStreet,” from 3,000 stores today to 5,000 stores in the near future.
“Demand is pretty strong for wings. You can’t get more than two wings out of birds, so there’s not much change in supply,” Brown said.
All things considered, Brown is reasonably optimistic for the long-term future of the poultry market. “The supply side is not the issue, when the economy improves, we should see an uptick in demand. I see opportunity for higher prices for the next two to three years for poultry producers, but I don’t expect we will see record-high prices.”














