MISSISSIPPI STATE -- Mississippi's poultry industry is overcoming challenge after challenge even as U.S. consumers continue to flock to the stores for more.

Kenneth Hood, agricultural economics professor with Mississippi State University's Extension Service, assisted with a recently released report on the economic impact of the state's poultry industry. Naming Hurricane Katrina as one of the biggest challenges in recent years, Hood described poultry as a “resilient industry” to bounce back from some economic obstacles.

“Hurricane Katrina came on the heels of the Russian embargo. Those were two very negative market factors back to back,” Hood said.

The Russian import ban took place in 2002 and was said to be in response to U.S. processing conditions and the use of antibiotics, but the move coincided with a U.S. tariff on Russian steel. Since 2004, Russia has led the world as an importer of U.S. poultry. Hurricane Katrina hit the state in August 2005, destroying cold-storage facilities at the port of Gulfport and severly damaging facilities at the port of Pascagoula.

 “In 2006, production expanded by about 2 percent, which was the slowest rate of growth since 2003,” Hood said. “The good news is that the U.S. Department of Agriculture is predicting the export market to grow by 3.4 percent this year.”

Extension poultry specialist Craig Coufal said producers this year are facing additional economic pressure in the form of fuel and feed costs.

“The dramatic increase in corn usage for ethanol production has greatly increased corn prices, and this has had a big impact on poultry producers since 60 percent to 75 percent of chicken feed (depending on age and type of chicken) is usually corn,” Coufal said. “Additionally, poultry production requires large amounts of electricity and gas. Both of those costs have increased significantly in recent years.”

Mike Pepper, president of the Mississippi Poultry Association, said the recently released report highlights the value of this agricultural industry. According to the report, Mississippi employs more than 24,000 people directly with another 23,000 jobs created indirectly. Poultry employees' wages and salaries exceed $1 billion annually in the state. In 2005, the state's poultry sector passed $2.2 billion in sales at the farm gate.

“This report shows that poultry is still the No. 1 agricultural commodity in the state with an economic multiplier and spillover effect like no other commodity,” Pepper said.

While fuel, electricity and feed prices are hitting the poultry industry hard, other meat products are experiencing the same production-cost increases. Fortunately for poultry, Pepper said consumption data in the report indicates that poultry is consumers' favorite meat, representing 48 percent of all meats consumed in the United States.

“People are eating more poultry every year,” he said. “Consumers appear to appreciate poultry from a health perspective and for its value dollar for dollar compared to other meats. We are constantly trying to develop different ways to prepare poultry to encourage people to eat it.”   

Get more information on the economic impact of Mississippi's poultry industry.