McDonald's, not Ethanol, is What's Raising Chicken and Food Prices

McDonald's Raising Price of Food

It’s not ethanol production that’s raising the price of food like chicken and beef. According to Bloomberg and Businessweek, the culprit is McDonald’s!

That’s right, gang! The 26% year-to-date price increase came along with a 1% drop in supply, which farmers say had nothing to do with ethanol. Now, as you are probably not suffering from severe brain injury, you might have noticed that 1% drop in supply should not a 26% spike in demand make. Where was all that demand coming from? That’s where McDonald’s – which announced plans to reintroduce bone-in “Mighty Wings” chicken at its 14,100 US locations this week – comes into play: to prepare for the tsunami of chicken wings, McDonald’s has been stockpiling chicken.

14,100 restaurants, by the way, will sell a LOT of chicken wings!

Not only that, McDonald’s has been stockpiling chicken for 18 months – right about the time people started noticing the price of chicken going up – according to industry analyst Nick Setyan, who explained the facts to Vanessa Wong at Bloomberg Businessweek and left behind this handy-dandy graph.


Graphs are fun.

Anyway, when the price of chicken futures started going up mysteriously a little over a year ago, there was a rush from big oil lobbyists to place the blame on the Renewable Fuels Act (RFA) and ethanol. Despite the fact that farmers blamed fluctuating oil prices and climate change for increased production costs and that the AAA came out against oil-lobby ads meant to turn the public against ethanol, a huge percentage of the public believed big oil’s ridiculous fear mongering. As has happened time and time again for the anti-ethanol hysterics, new information coming is making them look pretty silly.

So, here’s to reality continuing to make the ethanol haters look ridiculous!


Sources: Businessweek, Fuels America, the Week.

Jo Borrás

I've been in the auto industry 1997, and write for a number of blogs in the IM network. You can also find me on Twitter, at my Volvo fansite, out on two wheels, or chasing my kids around Oak Park, IL.