CLERMONT, Fla. – A recent analysis by CoBank Knowledge Exchange shows broiler chicken output remains strong, but expansion opportunities are narrowing.

According to the report, the construction of new processing plants has slowed due to higher capital costs, limited labor availability and tighter local regulations – factors that are restricting the industry’s ability to add new processing capacity.

Brian Earnest, CoBank lead animal protein economist in Clermont, said chick availability has trended downward as genetic priorities have shifted from hatchability (or how many chicks a hen could produce), to meat yield, but adding more pounds per bird has its limits: “The potential long-term challenge becomes, ‘How big is too big?’ for birds on the processing line, and what will drive consumer preferences for chicken products into 2030 and beyond.”

In the short-term, he said, there has been a growing interest in secondary processing or the value-add segment: “That’s helping chicken producers meet increased consumer demand for further-processed and flavor-enhanced items like tenders, nuggets and sandwiches. But it’s not necessarily a sustainable or long-term approach to consistently increase overall production volume.”

Earnest told Farm World the analysis draws on data from the USDA “and a variety of independent market research firms, as well as our work and direct interaction with producers and processors across the industry.”

According to USDA data, annual per capita chicken consumption in the U.S. has increased 30 pounds since 1995, and currently stands at 103 pounds. That number is projected to rise to 107 pounds by 2030, which far exceeds U.S. per capita consumption of beef and pork.

With the change in genetics, the analysis said, producers are now able to achieve more than 1,000 pounds of chicken from a single egg-laying hen, a 17 percent increase since 2005. While the shift in genetics enabled processors to increase broiler meat yields, those gains have come at a cost.

Earnest said his calculation (of more than 1,000 pounds of chicken from a single egg-laying hen) is based on the total amount of eggs that a broiler hatching type egg-laying hen produces during their productive life-cycle, multiplied by the average weight of the broiler chicken (ready-to-cook weight), based on USDA data.

In addition, he said he thinks producers recognize the opportunities for growth in the current market environment and are maximizing those opportunities in the further-processed category of retail chicken items: “As a whole, the chicken industry has done a remarkable job of meeting consumer demand through product innovation and operational efficiency.

“And we expect that will continue over the next several years, or until capital expenses associated with new greenfield processing plant capacity moderate,” he added.

Greenfield expansion involves building new, from-scratch infrastructure on previously undeveloped or agricultural land, offering maximum design flexibility for modern, efficient facilities without the constraints of existing structures.

“And over time, a shift in genetics to place more emphasis on hatchability will further increase the opportunity for production growth,” he added. “The remarkably steady increase in consumer demand for chicken will continue to be a tailwind for the industry for the foreseeable future.”

He said the elevated costs associated with new greenfield expansion will limit the addition of meaningful head count in the near future, and short-term growth will be facilitated by larger birds and continued investments will further processed capabilities.

“Relying on efficiencies in per-bird production will require flexibility and technology,” he said. “For processors, that means line speed efficiency will be paramount to grow production until such time as more birds can be added to meet steady growth in demand.”