The price of chicken, pork, and meat might be on the decline in the coming months, but not the way one would expect.
To lower emissions in the U.S., manufacturers are turning to plant-based jet fuel and diesel. This will lead to an abundance of soymeal, which is a popular form of animal feed.
With the cost of feeding animals dropping there should be a ripple effect reaching down to shoppers who have been dealing with the high cost of chicken, meat, and pork for months now, reports Bloomberg.
Feed costs account for about 60% of the amount of money it takes to raise cattle, chicken, and pigs, according to Bloomberg, and processing soybeans produces four tons of soymeal for every ton of oil.
However, the price change might not hit the grocery sector for several months, even years.
Some plants will require a significant amount of time to reach full capacity, reports Bloomberg, but the chicken industry will see prices cut before the others simply due to the shorter production cycle.
With the price going down to maintain animals, companies are also expected to capitalize on improved margins.
According to Chicago-based Circana, results in the meat department were mixed in October, but year-over-year price deflation was observed for lamb, packaged lunch meat, breakfast sausage, and processed chicken. Beef saw continued inflation, while chicken prices continued to be on the downswing.
Year-over-year unit sales for meat were down 3.8%. Chicken was the only fresh category that showed an increase in unit sales for October 2023 at 0.2% and finished second ($1.2 billion) behind fresh meat ($2.4 billion) in total dollar sales.
Every category in processed meats waswere down in terms of dollar and unit volume in October 2023. Packaged lunch meat was the top seller at $477 billion.
The results for grinds were much better, as ground chicken showed year-over-year increases in dollar sales (up 8.3%) and pound sales (up 12%).
