December 23, 2008 / 10:28 PM / 9 years ago

UPDATE 1-USDA buys 60 mln lbs chicken for school lunches

(Adds details about purchase)

WASHINGTON, Dec 23 (Reuters) - The United States Agriculture Department said on Tuesday it bought about 60.451 million pounds of chicken products for about $42.2 million for school lunch and other nutrition assistance programs.

The purchase program was announced last month to help the chicken industry, which has been hit hard by high feed and fuel costs amid slowing demand from cost-conscious consumers.

Close to 30 million pounds of chicken -- almost half the total -- was bought from Pilgrim’s Pride Corp PGPDQ.PK, the USDA said.

Pilgrim’s Pride, the top U.S. chicken producer, filed for voluntary bankruptcy earlier this month because of the difficult economic conditions.

The USDA also bought 16.787 million pounds from Tyson Foods Inc (TSN.N), the No. 2 producer.

Nine of 13 companies that submitted proposals to the program were successful, the USDA said.

Shipping costs to delivery destinations will be added to the price when the products are delivered between Jan. 1 and March 31, the USDA said.

A report with details about the purchase was not immediately available on the USDA’s web site.

LINK: * USDA's Agricultural Marketing Service commodity purchasing here

Washington commodities desk, 202 898 8376

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