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Wed, May 23, 2001 - Page 24 News List

Bar snack takes wing across America

FINGER FOOD Fast-food chains are putting chicken wings on their menus and the rise in demand is causing the popular appetizer to lose its profitablity

BLOOMBERG , CHICAGO

"As a snack item they generate extra sales and they don't interfere with the full meal that you are selling your customer," said Tony Scherer, director of supply chain management with Wendy's International Inc.

Chicken wings also have become a big seller for grocers and restaurants during the US football season, when fans crowd around televisions at bars or homes to enjoy finger foods during weekend games.

Wing prices usually rise around the Super Bowl, the annual football championship game, and then fall as demand weakens in early spring.

This year, that didn't happen. Prices have actually risen more than 10 percent since then.

Chicken wing prices in January averaged 91 cents a pound and are currently about US$1.01 a pound, according to the US

Department of Agriculture. Yak-Zies' Miller said he is paying about US$1.10 a pound.

Compounding the surge in prices is a slowdown in US poultry production, which is down 0.7 percent in the first three months of this year, the first year-on-year quarterly decline since 1982.

Still, production is expected to rise 2 percent this year, down from an annual average gain of about 5 percent.

Tyson Foods Inc, the largest producer, is selling so many wings it has been unable to stockpile supplies in freezers, as the company normally does at this time of year to ensure adequate inventories for the seasonal surge in demand in the fall.

Pilgrim's Pride Corp, the third-largest producer, is boosting its production by buying wings from five competitors, something the Pittsburg, Texas-based company usually does only during the Super Bowl.

"We are buying wings from anybody that we can right now," said Dan Emery, Pilgrim's vice president of marketing.

With prices showing no sign of coming down, some restaurants have increased the price they charge customers.

Hooters Inc, which sells about 37 million pounds of wings a year at 300 restaurants, raised the price of 10 wings to US$5.75 from US$5.45 at the end of April.

"The market's going to remain strong for the rest of the year," said Chuck Riley, Hooters director of purchasing. Prices probably will average about US$0.90 to US$0.95 a pound this summer, double the US$0.46 a pound they averaged in July and August.

Prices probably won't stay below US$1 per pound very long if at all for the rest of the year, said Bill Roegnick, vice president of the National Chicken Council.

"There are other supermarket and restaurant chains that are waiting and ready to step in and do some featuring of Buffalo wings if there is some easing on wholesale prices," Roegnick said.

At Yak-Zies, Kenny Miller seems resigned to raising his prices, too. "I can't continue to suck up the costs," he said.

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