Most know the success story of the chicken wing and how it went from an afterthought to the most highly sought after part. What’s lost in this story is how the breast meat tenderloin is related to wings in this trend, with prices in this segment supported by many of the same market forces and evolving foodservice concepts and trends that lifted wings to prominence.
A golden era
The prices of wings and tenders are closely related and both products occupy a premium pricing position compared with other chicken parts. U.S. Department of Agriculture (USDA) data indicates that between 2013 and 2017, the average price in the Northeast region for wings and tenders was $1.71 per pound. That compares to $1.40 per pound for boneless, skinless breast meat and $1.17 per pound for boneless, skinless thigh meat. Other parts of the bird, namely bone-in cuts, were much cheaper.
Between 2012 and 2017 there was not a single instance where both tender and wing prices declined from the previous year’s average. Neither part sold at an annual average price of less than $1.50 per pound during this time period either. This highlights consistently strong demand for wings during an extended period and also some of the ebb-and-flow between traditional bone-in wings and “boneless wings.”
Recent struggles
This year, however, is poised to be the first since 2011 with tender and wing prices declining in tandem. Both are in danger of posting average annual prices of less than $1.50 per pound this year for the first time since 2011 as well.
In recent years, demand growth, buoyed by emerging players in the foodservice space, has been able to keep up with and outpace supply growth to prop up both tender and wing prices. It appears as if recent supply-side activity – marked by aggressive expansion efforts by the US broiler industry – finally caught up to and is maybe swamping those demand gains.
Challenges and opportunities in 2019
With so much new construction pending, domestic growth in chicken supplies will be relentless through at least 2019 and possibly well into 2020. Vulnerabilities already emerged in the broader tender-and-wing space and it is possible problems will continue, and maybe intensify, as product availability climbs to record levels on a per capita basis.
There are rays of hope for chicken companies at least as it concerns these two items. Foodservice players are looking to expand aggressively in the coming years and keep building their growth and menu offerings around tenders, wings, or some combination of the two. We may well see demand gains again outpacing supply growth sooner than later.
Read more by Mark Jordan:
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wing-tender-price-chart
Average tenderloin and whole wing prices are in danger of dropping below $1.50 per pound for the first time since 2011.
