Playing Chicken

Where's the beef?

It's been a bad year for meat. Avian flu decimated the U.S. poultry population (you can blame it for record turkey prices this year) and the World Heath Organization put out an influential report in October saying processed meat and red meat could cause cancer. 

Tyson Earns It

Closing stock price year to date.

Source: Bloomberg


Poultry and pork, however, are enjoying booming global sales because of cheaper production costs and increased demand. According to Bloomberg Intelligence analyst Kenneth Shea, the poultry market (which includes that Thanksgiving staple, turkey) is benefitting from Western chowhounds trying to make healthier choices. China's growing middle class accounts for much of the growth in the pork market.

Meanwhile, beef is pricier than chicken or pork on a per-pound basis, so many diners are simply electing to save money. (Fish is also popular among health-conscious consumers, but the data for that category are harder to track collectively because many of the producers are smaller and more dispersed.)

poultry thanksgiving

Tyson Foods is the largest meat producer in the U.S. In its annual earnings report, released yesterday, the power of poultry is evident. Although JPMorgan downgraded Tyson's shares in the wake of the WHO report, the stock has been on a tear of late, surging to a record high of $49.09 at the close of trading yesterday.

Tyson attributes its rebound to chickens. Low prices for corn and soy, the components of chicken feed, have allowed Tyson to enjoy operating margins for its chicken business of 12 percent in 2015. (Its beef business sagged beneath a -0.4 percent operating margin this year.)

For any other players in the meat market, Tyson offers a lesson: Play chicken.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

    To contact the author of this story:
    Rani Molla in New York at

    To contact the editor responsible for this story:
    Timothy L. O'Brien at

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