Why chicken is getting more and more expensive

Chicken is the meat of choice for the dinner table in Britain, but consumers may have noticed the numbers on their receipts rising.

As the cost of chicken feed, energy and transportation increases, fast-food chains like Nando’s and KFC have already raised some prices.

The boss of Co-op supermarkets has warned poultry could become as expensive as beef, while official figures suggest the price of chilled oven-ready chicken has risen from £2.50 to £3 a kg in the last two years is.

“The problem we have is that all sorts of prices are going up and up,” says poultry farmer James Mottershead.

His family bought West Midlands Farm in 2001.

Demand has increased in recent years and the company now raises around 1.5 million chickens a year.

We follow the production process step by step to see where the costs for poultry farmers and processors are increasing.

Poultry accounts for 50% of the meat consumed in the UK and according to the British Poultry Council, a billion birds are raised in the country each year.

Mr. Mottershead, who is also chairman of the National Farmers’ Union Poultry Committee, receives shipments of about 215,000 chicks in seven “cycles” each year.

The broilers, raised specifically for meat, arrive at the farm at a day old.

However, the price of chicks has risen by 5p in the last year, with costs now exceeding 40p per bird, says Mr Mottershead.

Hatcheries have come under pressure as costs for feed, electricity and heating have increased during the breeding season and these are passed on to farms.

Mr. Mottershead and two dedicated full-time staff look after the chicks, which are then reared in special poultry houses.

There, too, the running costs are increasing.

The staff start on site at 07:00 and check the water consumption and food availability as well as the health of the birds.

All birds on the farm are sold as Red Tractor Assured, which means each chicken can be traced back to the hatchery it came from and has 10% more space than required by European legislation.

The farm produces renewable energy. The commercial sheds use LED lights and have solar panels on the roof. Even so, according to Mottershead, electricity prices have “exploded” in the last year, with the cost per kilowatt roughly doubling.

Some of the sheds also have LPG tanks for heating. Prices are now topping 40p a liter, up from 15p two years ago – spurred by Russia’s invasion of Ukraine and worries about the impact the conflict could have on supplies from one of the world’s largest gas exporters.

The farm uses borehole water, but the cost of chemicals used to disinfect the water has increased by about 30%.

The farm also uses around 200 tons of wood chips every year to bedding the chicks. The cost of buying in bulk has increased by about 40% over the past 12 months.

Aside from scraping wood shavings, feed costs, which make up a large part of a poultry farmer’s budget, skyrocket.

The farm now spends around £2 million a year. Depending on the stage of the chicken’s life cycle, different types of feed ingredients are used – be it a chick crumb or rearing pellets for later.

Kynan Massey, chief executive of feed company Massey Bros, told the BBC “prices have never been this high”.

That’s because the feed is often made from wheat or soy, a by-product of sunflower oil, prices of which have soared due to crop failures last summer and the conflict in Ukraine.

“Russia and Ukraine account for a quarter of the wheat exported around the world,” says Massey. “If the conflict continues, prices could continue to rise and in Europe the dry weather is also having an impact on costs.”

In the poultry houses, the weight of the birds is regularly monitored.

The number of birds will be reduced after 32 days once they have reached their target weight to ensure the farm meets density per square meter regulations.

About a third of the chickens in the house are then sent to the slaughterhouse, while the rest of the chickens are removed after 39 days.

They are transported in boxes by truck. Of course, fuel costs have also risen.

For example, UK diesel prices rose to a record high of just over £1.80 a liter on Monday, according to the RAC.

After hitting a previous record of £1.79 in March following the invasion of Ukraine, prices have fallen but have risen again in recent weeks.

And it was harder to find a truck driver. The shortage has been attributed to a combination of factors including the pandemic, Brexit and tax changes.

As a result, wages have skyrocketed, with annual salaries being offered by some transport companies reaching £80,000.

“The reality is that when there’s a shortage, people can name their prices,” says Mr. Mottershead.

In UK processing plants, most chickens are now killed with gas – usually carbon dioxide, a by-product of the fertilizer production process.

Gas prices have already soared over the past year, forcing major fertilizer factories in the UK to shut down production.

Although the UK produces around half of its own fertiliser, conflicts further afield have pushed costs up further.

Russia is a huge producer of key fertilizer ingredients like ammonia, so supply concerns are having an impact on carbon prices.

2 Sisters, one of the UK’s largest suppliers of chickens, told the BBC that carbon costs had almost quadrupled.

After the chickens have been killed, farm workers defeather, clean and pack them. Card packaging costs have also increased by 20% over the past few months, according to 2 Sisters.

Producers are also spending more to work in factories due to an increase in the national minimum wage. Others are offering higher salaries to attract workers amid ongoing labor shortages.

Finally, the packaged chicken is sold to customers such as butchers, chain corner shops, manufacturers or supermarkets.

But Ronald Kers, the boss of 2 Sisters, has said entrance costs have skyrocketed before that point.

“Farm prices have already increased by almost 50% in a year,” the company, which has 600 farms and 16 factories across the UK, said earlier.

It warned that the days of lower prices were coming to an end.

Mr Mottershead points out that although some poultry producers are struggling, supermarkets are reluctant to pass the cost on to their customers as the cost of living increases.

“We do everything we can to produce high quality chicken and egg products, but there are a large number of farmers who cannot fill up their stalls because the costs are too high,” he says.

Russia’s war in Ukraine has “exacerbated” the existing bottlenecks, he suggests.

For poorer families and countries, “reality cannot be reconsidered”.