Spend Matters welcomes this guest post from Nick Smith at Mintec.
Last night, amid the controversy that has been dubbed “deflate-gate,” Super Bowl XLIX was staged between the New England Patriots and the Seattle Seahawks. In case you missed it, the Patriots won 28-24 against the Seattle Seahawks. However, the NFL is investigating whether the Patriots may have deflated some of the match balls in the semi-finals in order to gain an advantage. Whatever the outcome of the investigation, one thing that is definitely not deflated is the price of chicken wings!
Super Bowl Sunday is considered to be the second largest day for food consumption in America after Thanksgiving Day. It’s the most watched annual television program in the US and many people attend Super Bowl parties where large amounts of food is usually on offer. In 2013, Mintec wrote about how the event has a huge impact on the price of chicken wings, and 2 years later the same is still true.
As the Super Bowl approaches, demand from supermarkets and restaurants builds in anticipation of the huge demand from football fans. It is thought that a massive 1.25 billion wings were eaten on Sunday! With this spike in consumption comes an inevitable jump in prices. Although, prices this year have not reached the highs seen in 2013 when Mintec last wrote about this phenomenon, in January 2015 they surged11%. This represents an increase of more than 50% year-on-year.
The price of chicken wings increased steadily throughout 2014, in part due to reduced stocks. Stocks in cold storage last year were nearly 40% lower at some points of the year than they were in 2013, despite starting the year off higher. Production of chicken meat is forecast to have risen in 2014, up 2% to 17.5 million tonnes, due to increased slaughter weights. But no matter how large the birds get, there can only ever be 2 wings per bird. The number of chickens slaughtered has fallen so consequently there are fewer wings available. Nearly 7.8bn broiler chickens were slaughtered between January and November 2014, compared to just over 7.8bn in the same period of 2013, down 23 million birds. Wing prices saw some declines toward the end of 2014 but finished the year 45% higher than they started because of the drop in slaughtering.
The consequences of “deflate-gate” for the Patriots remain to be seen, but one thing’s for sure, if you enjoyed chicken wings yesterday then you may have also found your bank balance somewhat deflated.