Source: MEATINGPLACE, 12/2/11

The chief executive of Sanderson Farms said he expects chicken prices to rise again after Christmas and suggested light breeder flocks could lead to strong margins in 2013, according to a report by J.P. Morgan, which hosted Sanderson executives at a recent investor conference.

While chicken prices typically rise in January following the turkey-oriented Thanksgiving and Christmas holidays, Joe Sanderson’s comments were reassuring to hear, J.P. Morgan analyst Ken Goldman said in a note to clients. Goldman said he is projecting improved chicken prices from January through the summer.
Asked if the chicken industry will recover in 2012 or 2013, Sanderson told the conference a recovery needs to happen next year or more bankruptcies will occur, Goldman said. And because breeder flocks are light, even an average corn yield in 2012 could set the stage for very strong margins in 2013, Sanderson said.

Sanderson continues to have success selling retail birds to Northeast grocers, with the latest customer being A&P in New Jersey, according to the J.P. Morgan report. “The company has stated in the past that its venture into the Northeast with tray pack birds was one of the most successful in its history, which we believe is still the case,” Goldman wrote.

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