Chicken giant Inghams warns of up to $10 million in fuel costs hit
Chicken fillets, nuggets and burgers could get more expensive after one of the nation’s major poultry producers warned of rising fuel bills triggered by the ongoing war in the Middle East.
Chicken fillets, nuggets and burgers could soon be more expensive after one of the nation’s major poultry producers warned of rising fuel bills triggered by the ongoing war in the Middle East.
Inghams chief executive Ed Alexander on Monday said the impact of higher diesel fuel costs — flowing through via fuel levies from transport providers — was expected to be in a range of between $7 million and $10m, “after customer pricing actions and operational improvement initiatives”.
But Mr Alexander said the company — a major supplier to McDonald’s, KFC, Woolworths, Coles, Aldi, Metcash and Subway — expected to offset these pressures through $60m to $80m in annualised savings from labour, procurement and site operations initiatives.
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By continuing you agree to our Terms and Privacy Policy.Inghams warned the fallout from the war was also putting pressure on feed costs, which are expected to be higher in the next financial year.
It expects the impact of higher costs to be minimal for the 2026 financial year because the company operates with a feed procurement policy of having three to nine months forward cover.
Inghams said it was also mitigating packaging cost increases that were beginning to emerge.
In a trading update as part of the company’s investor day on Monday, Inghams reaffirmed its earnings guidance of between $180m and $200m for the 2026 financial year, after recording a slight increase in core poultry volumes.
For the first nine months of the financial year, group core poultry volumes increased 1.1 per cent from the prior corresponding period, with the Australian division rising 1.2 per cent and NZ growing 0.5 per cent.
Inghams is the latest ASX-listed company to flag impacts of fuel costs which have soared since the US and Israel began a military offensive against Iran on February 28.
Last week, Super Retail Group — which is behind big-box retailers BCF, Rebel and Supercheap Auto — said higher prices at the pump and fuel supply constraints curtailed outdoor pursuits over the key Easter and school holiday trading period.
It came just days after Dan Murphy’s and BWS owner Endeavour Group revealed it was bracing for a hit of up to $8m on higher fuel costs triggered by the war.
It is targeting $100m of cost savings for next financial year as new boss Jayne Hrdlicka looks to cement a three-year turnaround strategy.
Originally published as Chicken giant Inghams warns of up to $10m in fuel costs hit
