There has been a long-held view {that a} sturdy export market is a prerequisite for the U.S. broiler trade to command a premium value for darkish meat, leg quarters particularly. It’s a part of a broader narrative centering on home shoppers’ choice for chicken, main to a “surplus” of cuts from the again half of the chook that both want to search out a house exterior of the nation or else be closely discounted to make sure clearance by means of home advertising and marketing channels.
Going again to when Russia dominated the export program up till a few decade in the past when extremely pathogenic avian influenza (HPAI) despatched exports right into a tailspin, the proof actually backed that concept with increased leg quarter costs usually corresponding with intervals of export power and vice versa. Extra not too long ago, nonetheless, there was a decoupling of export power and darkish meat costs.
Turning level
A pivotal second on this journey occurred in August 2014 when Russia formally reduce ties with the U.S. on agricultural and meals commerce. Already reeling from that, the U.S. broiler trade’s export program suffered one other blow lower than a 12 months later as a result of a historic outbreak of HPAI and the commerce restrictions that adopted.
Between 2011 and 2014, the export share of ready-to-cook (RTC) broiler manufacturing in the U.S. constantly exceeded 18%, and bulk leg quarter costs averaged extra than $0.46 per pound throughout this four-year stretch in response to the U.S. Division of Agriculture (USDA). With the export share of home broiler manufacturing slumping to both facet of 16% in 2015 and 2016, leg quarter costs averaged lower than $0.30 per pound. The export share of home manufacturing in the end stabilized within the 16-17% space for just a few years, and the common annual value of bulk leg quarters ranged largely between $0.25 and $0.35 per pound.
Cultivation of boneless darkish meat
It seems that home shoppers’ ostensible choice for chicken has extra to do with the truth that merchandise in that class are extra readily out there in boneless type than something notably off-putting with darkish meat.
In truth, for years, shoppers have reported an affinity for darkish meat in surveys, however value discrepancies between the back and front halves of the chook nonetheless implied a disconnect. These discrepancies grew to become much less apparent when evaluating boneless chicken to boneless darkish meat, nonetheless, and the response from integrators has been to domesticate processing expertise permitting them to debone a better share of darkish meat, and thigh meat specifically, than they as soon as did.
Skyrocketing costs for boneless skinless breast meat, tenderloins and wings again in 2021-22 made darkish meat extra engaging, however it wanted to be in the correct type (i.e., boneless) to “click on” with shoppers. The push to debone extra darkish meat has accelerated, slicing into the provision of bone-in cuts as soon as seen because the linchpin of the export program.
Principally, it is a traditional case of a “rising tide lifting all boats.” Whereas growing demand for boneless darkish meat has been the catalyst for change, a facet impact has been an entire reshuffling of the darkish meat complicated to de-emphasize bone-in cuts. That’s the reason, regardless of the export share of U.S. broiler manufacturing hitting a 20-year low in 2024, bulk leg quarters nonetheless managed to common almost $0.50 per pound for the whole 12 months.
