(Bloomberg) -- The Georgia Dock chicken-price index, an industry benchmark whose reliability has been questioned in recent months, won't be published this week because of a lack of data from participating producers, the Georgia Department of Agriculture said.
The department, which has compiled the index since 1972, saw a “significant reduction” in participants after new reporting requirements were established, spokeswoman Julie McPeake said in a telephone interview on Wednesday. She declined to comment on the number of producers who contributed data, but said the total was insufficient.
The index has come under fresh scrutiny after the largest U.S. producers were named as defendants in a series of lawsuits filed since September alleging collusion to control supply and drive up prices, something the companies have denied. The index has also been criticized by the director of Georgia Department of Agriculture's weekly chicken-price report, who complained of inadequate resources and a lack of cooperation from the chicken companies.
The gauge has been widely used to help formulate some of the sales contracts between producers and consumers. The wholesale value of the U.S. chicken industry's annual shipments is $60 billion, according to the National Chicken Council.
The Georgia Department of Agriculture had asked participants to sign and return affidavits and attestations by Tuesday confirming the data they provide is accurate. McPeake said the department had received some documents from some companies but others may need more time. She declined to provide the names and exact number of participants.
Pilgrim's Prices
“We do understand we gave them a short turnaround,” she said. “It is possible we may resume publishing the Georgia Dock in the future.”
One producer that's still participating is Pilgrim's Pride Corp., the second-largest U.S. chicken supplier. The company is “comfortable” attesting to the accuracy of its data, Chief Executive Officer Bill Lovette told analysts on a conference call Wednesday.
Tyson Foods Inc., the biggest U.S. producer, and Sanderson Farms Inc., the third-largest, didn't immediately respond to requests for comment. The two companies said earlier in the week they were considering the request for affidavits.
Tyson fell 1.6 percent to $58 at 12:54 p.m. in New York while Pilgrim's dropped 1.8 percent to $17.97.
Other Tools
The Georgia Dock quoted poultry price, published on Wednesdays, is an average of offering prices for birds weighing between 2.5 pounds (0.5 kilogram) and 3 pounds. In the past, as many as 10 producers have participated, including Tyson and Sanderson. Each company's data is weighted according to production capacity.
Georgia Dock has been an effective pricing tool for “select” chicken products historically, Pilgrim's Lovette said. However, he added that less than 5 percent of his company's U.S. sales are tied to the index, with customers choosing from a range of available pricing tools.
It's the first time the Georgia Dock has been suspended, as far as current officials at the Georgia Department of Agriculture are aware, according to McPeake. The department's new requirements also apply to data it collects for reports published on other days of the week, including the Georgia Preliminary Weighted Average Whole Bird Poultry Price” on Thursdays, she said.
To contact the reporter on this story: Shruti Date Singh in Chicago at ssingh28@bloomberg.net. To contact the editors responsible for this story: Simon Casey at scasey4@bloomberg.net, Patrick McKiernan
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