Chicken Shortage Raises Costs for Restaurants

May 19th, 2021

At the beginning of 2021, chicken looked like a bargain for US restaurants. 


Today’s blog is by Gayl Southard, Vice President of Administrative at SafeSourcing.

After a year of promoting chicken sandwiches and wings, many restaurants such as Buffalo Wild Wings, KFC, and Wingstop are paying much more for poultry.  Some restaurants are running out of chicken or limiting the amount of tenders, fillets, and wings sold.  Some independent eateries and bars have gone weeks without wings.  The price of chicken breasts have more than doubled since the beginning of the year, and wing prices have hit record highs, according to Urner Barry, a market research firm.  Wingstop reported they are paying 26% more for bone-in wings this year.  One of the problems with the poultry industry is getting employees to work.  The lack of workers is affecting many industries.

At the beginning of 2021, chicken looked like a bargain for US restaurants.  Closures of dining rooms had contributed to the stockpile of chicken in cold-storage facilities.  Boneless, skinless breasts averaged $1 a pound last year.  Today, the same product is $2.04 a pound.  Over the past decade the average price was $1.32 a pound.  This is a huge increase!

The chicken sandwich wars in fast food chains have also contributed to increased prices.  Companies such as McDonalds, Popeyes Louisiana Kitchen, Inc., and Wendy’s introduced new crispy chicken offerings.  Chicken sandwiches have always been a better dollar value, especially for families.  The biggest problem for supermarket, fast food chains, and restaurants is keeping up with the demand.  A KFC spokesperson reported that they look forward to getting back to normal once the short supplies ease.

Chicken-wing prices have risen to $2.92 a pound. Fast food restaurants serving wings grew 33% in the past 12 months, ending in March 2021, compared to the previous year.  For chicken producers, the restaurants growing poultry appetite is driving a windfall and offsetting the higher grain prices.

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Heather Haddon and Jacob Bunge, WSJ, 5/7/2021



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