Monday, November 21, 2016

Questions America Wants Answered: "Are Chicken Prices Being Manipulated?"

From Forbes:
There are a lot of things we regularly overpay for. Last-minute holiday gifts, concert tickets, and iPhones come to mind. Surprisingly, we can now add chicken to the list.

The New York Times recently reported some unusual discrepancies in the indexes that guide how our chicken is priced in grocery stores. Of the three primary indexes used to help set chicken prices, two of them hovered around $.72/cents a pound at the end of October. The other, however, was at $1.10/pound. That’s a gap of over 30%. Wow.

It turns out that there’s a reason for the discrepancy. While the other two indexes work diligently to validate the information they receive from chicken producers, the third index, Georgia Dock, does not. Hmmm, I wonder why?

The Georgia Dock, founded by the Georgia Agriculture Department since 1966, is used by many supermarket meat buyers as a starting point for negotiations with chicken producers. The index today is based on data from 10 of the 11 companies that process poultry in the state.

If the largest American companies selling chicken are telling the Georgia Dock which prices to use, and Georgia Dock isn’t properly verifying that info, there’s a good chance they’re artificially propping up prices....MORE
One of the companies named in the Times piece does not seem to be any good at the manipulating thing. Here's a story from Reuters:

Mon Nov 21, 2016 | 1:06pm EST
Tyson Foods shares slide 15 percent on dim profit forecast; CEO to step down