Tyson Begins $48 Million Poultry Production Expansion as Chicken Demand Soars

The "chicken sandwich wars" that began in 2019 are showing signs of heating up again, and Tyson Foods (NYSE: TSN) is preparing to supply the combatants. It announced Thursday it was initiating a $48 million expansion of its Arkansas poultry processing facilities. "Demand for convenient, high-quality chicken products continues to grow and we're investing in projects that meet the needs of our customers," Tyson Poultry Group president Donnie King said in a statement.

The project focuses on building more capacity at an existing facility in Pine Bluff rather than constructing a new factory from the ground up. Automated packing, more "fully cooked" processing lines, and additional air frying lines are among the planned additions or extensions, which will also create approximately 70 more local jobs. The renovation should be finished sometime in 2021.

Three workers in protective gear working at a poultry processing plant.

Image source: Getty Images.

Tyson's decision to bolster its chicken production appears well timed. QSR Magazine reports Sense360 research shows the "chicken sandwich wars" are gathering fresh steam. The data shows 13 different restaurant chains launching new chicken products over the past year and a half, with a significant number in the final months of 2020. Almost all of the restaurants saw sales surge in the weeks following the poultry-based item's first appearance on the menu.

The studies provide a close look at McDonald's performance after it started selling chicken sandwiches. Customer traffic jumped 19.1% on the day of launch and climbed even higher the day after, and monthly visits stayed higher once the popular sandwiches were available, even into the coldest winter months.

QSR Magazine's reporting also cites researcher Placer.ai, which said the chicken sandwich "fundamentally altered the trajectory for McDonald's." Tyson's strategy, therefore, is clear: boosting its ability to supply processed chicken to a growing, eager American market.

10 stocks we like better than McDonalds
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and McDonalds wasn't one of them! That's right -- they think these 10 stocks are even better buys.

See the 10 stocks

*Stock Advisor returns as of February 24, 2021

Rhian Hunt has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


More Related Articles

Info icon

This data feed is not available at this time.

Sign up for Smart Investing to get the latest news, strategies and tips to help you invest smarter.