Friday, December 28, 2018

Keeping our Options Open


Competition keeps consumer costs down

As we close another year, I was beginning to wonder if some parts of the poultry industry are painting themselves into a marketing corner.  With the push for being more like the European plan for producing food, one key aspect may have been overlooked.  It takes capital to switch to another major method of production, and as we have seen in studies there are positive and negative aspects to the new methods of production.  So, whether be it cage or free, slow or fast, organic or not by picking one sole method of production may not give the industry the revenues it was looking for.  Those companies who managed to hold onto a diversified mix or portfolio of production may indeed make out due to economy of scale and lower cost of production for that portion of the market they serve.  In the end, I believe we will need to keep a rich and diverse option of egg and meat products if we are going to maintain the lead in protein at the market.  Time will tell how the consumer will react to new offerings, but with the low cost of substitution, the new products will have to be superior in some aspect to get the consumer to change.