High grain prices and weak consumer demand for chicken took their toll on the U.S. broiler industry headed into 2012. WATT PoultryUSA’s Top Poultry Companies 2012 rankings reflect industry upheaval as five chicken producers ceased operations, declared bankruptcy or were acquired in 2011.

Economic toll on companies

Chicken companies sold off, closed or in bankruptcy included the following:

• Townsends, Inc., ceased operations after entering Chapter 11 bankruptcy. The company’s Arkansas complex was sold to Peco Foods. The North Carolina operations of Townsends were closed in 2011 by Omtron Ltd., which brought the processing plants, feed mills and hatcheries while Townsends was under Chapter 11 bankruptcy protection.

• Allen Family Foods was acquired by Harim Holdings of Korea which restarted operations as Allen Harim Foods, LLC.

Cagle’s Inc. entered bankruptcy proceedings.

• Lady Forest Farms ceased operations taking Chapter 7 bankruptcy.

• Vineland Kosher, Inc., ceased operations on Dec. 30, 2010.

Economic renewal amid tough economics

Green shoots appeared, however, as companies positioned for economic renewal in 2012:

• No. 1 ranked Tyson Foods, Inc., reopened the Grannis, Ark., plant.

Pilgrim’s, Inc., reopened the Douglas, Ga., plant.

Sanderson Farms opened a plant in Kinston, N.C.

Acquisitions are also part of the economic renewal:

George’s, Inc., acquired the Harrisonburg, Va., complex from Tyson Foods.

O.K. Foods was acquired by Mexican chicken company Industrias Bachoco SAB de CV.

Topsy-turvy rankings

It was a topsy-turvy year for the broiler rankings. In a year when 18 companies reported increases in ready-to-cook chicken production and 11 reported decreases, few companies stayed put in the rankings.

While Tyson Foods and Pilgrim’s retained their locks on the No. 1 and 2 positions in the rankings, Sanderson Farms – with the opening of the plant in Kinston, N.C. – edged out Perdue Farms for the No. 3 spot by a mere 0.5 million pounds weekly.

Wayne Farms and Mountaire Poultry jumped ahead of Koch Foods to claim the No. 5 and 6 berths in the rankings.
Peco Foods jumped to the No. 8 spot passing House of Raeford Farms and Foster Farms now at No. 9 and No. 10, respectively.

Companies making notable moves up in the rankings in 2011 included George’s to No. 12 from No. 15; Amick Farms to No. 14 from No. 18; and GNP Company to No. 18 from No. 23.

Other companies slipping more than one spot in the rankings included Simmons Foods, O.K. Foods and Allen Harim.

Capital improvements

Peco Foods purchased the Arkansas complex from Townsends Inc. in 2011. The purchase included the grow-out operations, hatchery, feed mill, slaughter plant and wastewater treatment facilities. The company also constructed a new 8,900-ton feed mill at Lake Mississippi with a 110-railcar loop with future capacity up to 17,800 tons.
Peco plans $15 million of equipment improvements at the Batesville, Ark., complex.

George’s purchased the Harrisonburg, Va., complex from Tyson Foods in May 2011. The complex includes a feed mill, hatchery, slaughter and deboning plant and truck shop.

GNP Company expanded the water treatment facility and chilling system at the Cold Spring, Minn., complex in 2011.
Mar-Jac Poultry has plans for a $2 million expansion of its deboning operation.

Farmers Pride adopted Slow Induction Anesthesia in its slaughter operation in 2011.

Miller Poultry installed a new pellet mill and Ossid seamed packaging equipment in 2011.

Gerber Poultry has plans to expand its hatchery at a cost of $750,000 in 2011, including the addition of a new egg setter. The company also plans to upgrade its sizing line and rolling stock.