The poultry industry stayed confident about the present and hopeful for the future even while facing wavering consumer optimism and staggering inflation.
Favorable conditions
Despite negative trends in consumer confidence, the WATT/Rennier Poultry Confidence Index (PCI) recorded strong improvements in Present Conditions with optimism for most everything else in the fourth quarter of 2021.
The PCI’s Overall Index now stands at 149 (1985=100), an increase from 135 in the third quarter of 2021. The Present Situation Index — based on respondents’ assessment of current business and labor market conditions — rose to 169 from 140 during the same period. The Expectations Index — based on consumers’ short-term outlook for income, business and labor market conditions — was virtually unchanged at 135, compared to 132 last quarter.
Industry perspective
Once again, the industry has proven resilient to obstacles. Although we did not ask participants why they were more optimistic about present conditions, those predicting better conditions in the next six months primarily cited a return to normalcy as the COVID-19 crisis hopefully wanes, labor shortages improve, and demand strengthens.
Recent reports that supply is ramping up to meet expected demand also contributed to the positive mood.
However, a sizable number of respondents expressed concern about continued labor shortages, the lingering impacts of regulations and a general lack of certainty surrounding COVID-19. Many expressed concerns about inflation, not only impacting consumers’ pocketbooks but for key input costs like feed and energy as well. Labor needs also weighed heavily for some.
Looking ahead
The poultry industry fared better than the general consumer marketplace. The Conference Board’s Consumer Confidence Index dropped in November 2021. The board reported consumers were primarily concerned about rising prices, with planned delays or reductions for major purchases like homes, automobiles and major appliances.
Although the board expects a good holiday season for retailers and a continued economic expansion into 2022, it did predict “both confidence and spending will likely face headwinds from rising prices and a potential resurgence of COVID-19 in the coming months.”
