Chicken set to soar by 40%

THE cost of Australia's favourite meat, chicken, is about to rise by up to 40% - and could continue to rocket into next year, major producers have warned.

The reason? The cost of feed grain is soaring, affected by drought in the United States.

But it is not all bad news.

Australia's "big seven" companies - which includes Inghams - supply 70% of the country's meat market. The rest comes from small farms, often through small outlets like Charlie Everson's Forest Glen Organic Meats.

"We have heard nothing from our suppliers about increased feed costs," Mr Everson said yesterday.

"But they use Australian-grown feed for their free-range, organic birds. Usually, they are more expensive.

"If the bigger suppliers lift prices by 40%, it could be a bonus for us.

"We would be supplying an organic product and it could cost less. We have no plans to lift prices."

Richard Glover, who runs a small free-range poultry farm north of Kin Kin, agreed.

"I talked with my (feed) supplier yesterday and he didn't mention any rises, planned or otherwise," he said.

Mr Glover's Wolvi farm runs about 8000 chickens, as well as turkeys and ducks.

Managing director of the country's largest supplier Baiada, Simon Camilleri, warned that chicken meat prices could rise steeply.

"It depends on supply (of feed)," Mr Camilleri told the ABC.

"If there's a shortage of supply, it could rise between 10% and 40%."

And Mr Camilleri said prices could rise for as much as nine months.

"The outlook on grain is we're going to have higher grain costs until at least April or May next year," he said.

But after an oversupply of chicken meat in the past three months, the price for consumers is going to appear much greater.

Chicken Meat Federation deputy director Vivien Kite said grain prices had increased significantly over the past three months.

Ms Kite said those hikes had come because heavy drought was forecast to hit the US corn crop.

"We've seen wheat prices here increase by about $100 a tonne over the past three months," she said.

"That represents an increase of around 30%. We would expect that this surge in feed grain prices will push chicken meat production costs up by about 5%."



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