Pilgrim’s Pride Corp, one of the biggest U.S. chicken companies, underestimated meat production at the end of last year, Chief Executive Fabio Sandri said on Thursday after the company reported a surprise quarterly loss.
The company, owned mostly by meatpacker JBS SA, joined rival Tyson Foods Inc in misjudging that lower beef and pork supplies would increase demand for chicken as consumers grapple with high inflation.
Pilgrim’s shares still rose by 5% as the company said it expects beef supplies to shrink later this year and is now seeing some consumers switching to chicken.
Executives expected total meat supplies to tighten toward the end of 2022 because U.S. ranchers slashed the size of the cow herd while avian flu wiped out millions of turkeys, Sandri told analysts on a call.
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