In addition to production cuts the poultry industry has taken in recent months, Sanderson Farms Inc. Chairman and CEO Joe F. Sanderson predicted another round of cuts in September, followed by still another in October or November.

"I think you are going to see a wave of cuts after Labor Day, a tentative thing, then the industry will see what the market does; and it probably won't be enough," Sanderson told analysts on a conference call Friday. He added that he expected another round of production cuts in October or November.

He was more circumspect, however, about the company's own plans around production. Sanderson said traditionally the company's plants do not run at full capacity through the fall, typically going back to full capacity in February. He said seasonal fall cuts are already in place, but it would be late fall before he would decide whether or not to go back to full capacity in February, 2009.

Explaining the decision announced Thursday to delay construction of a $126 million plant in Kinston, N.C., Sanderson said the company had built assumptions of $7.50 per bushel corn and $400 per ton soymeal in 2009 into its financial plan for the project. However, this week's indications of $8.00 per bushel corn and $450 per ton soymeal would push the company's operating costs up another $60 million, making the plant investment too much of a risk to the balance sheet just now.

While reiterating his commitment to the plant in the future, it appears the delay will be substantial. Sanderson said he could not see starting construction on the plant without a clear indication of not only prospects for this year's crops, but also those for the 2009 corn and soybean crops: "What if the 2009 crop is bad?"

For more stories, go to www.meatingplace.com.