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Where’s My Chicken Foot?

September 13th, 2009

cf2Ten years ago or more, the National Chicken Council came under fire for not meeting consumer demand for chicken feet in China. “What can I tell you,” the president of the U.S. council said, “We have a billion chickens, and each has only two feet!”

Why do I recall the anecdote now? Because Barack Obama has moved to raise tariffs on China-made auto tires, and China has responded by suggesting that it is going to launch a probe into U.S. “dumping” of chicken parts into China.

A couple of things. First, U.S. demand for (certain) chicken parts will always be lower than China’s, because Westerners do not place the same value on things like chicken feet (sorry, but true). Second, America is slaughtering around 9 billion chickens each year — that’s only 18 billion feet — and with a supposed 1.3 billion Mainland Chinese, demand still easily outstrips supply. (Imagine: “I’m sorry, Mr. Wang, but you’ve already eaten the September ration. You’ll simply have to wait until October for your next foot…”)

cf12Bottom line? If China launches a retaliatory strike on U.S. poultry, it is going to hurt itself more than anyone else. U.S. chicken values are fairly low, and if our farmers need to increase prices because they can’t get parts out to China, consumers in the U.S. will survive. They will either pay a little more, or they will look to substitutes. I don’t think the same can be said about Chinese consumers, who have a strong affinity for certain bird parts, and who are more price sensitive.

China doesn’t want to retaliate, not really. Case in point from the China Daily; while talking tough, Beijing is throwing down the pity card. The propaganda broadsheet is “reporting” that new tire tariffs will lead to as many as 100,000 job losses for China. I don’t believe those numbers, and I don’t think that we will see China slow down the importation of U.S. chicken parts in the near future either.

[Note: There are approximately 1 billion chickens in the U.S. at any given time, while 9 billion are slaughtered each year. It takes only a few weeks to grow a chicken.]

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