MILWAUKEE—The nation’s largest chicken producer, Pilgrim’s Pride Corp., said Thursday that high animal feed costs will force it to post a “significant loss” in its fiscal fourth quarter and that it was trying to negotiate new terms with its lenders.

Its shares, which had already dropped 38 percent a day earlier before being halted, slid nearly 40 percent more to levels not seen since 2002.

The company, which holds about a quarter of the U.S. chicken market, said it is so sagged by debt that it may not meet the terms of its loan agreements, which means it could be forced to repay its debts faster than expected and possibly penalties. Analysts say arranging other financing may be difficult because of the credit turmoil on Wall Street.

Pilgrim’s Pride did not offer any details about the size of the loss and spokesmen did not return messages left seeking comment. Analysts polled by Thomson Reuters expect a loss of 89 cents per share for the fiscal fourth quarter.

The announcement sent the company’s battered shares down even more in a week that has seen its stock nearly erode on the credit worries. Trading was halted Wednesday afternoon, freezing the stock at a 38 percent drop. On Thursday, its shares set a 52-week low when they hit $3.26 for the first time since 2002. They closed at $3.84, a drop of 39.6 percent, in heavy volume.

Pilgrim’s Pride said in a statement the big loss for its fourth quarter, which ends Saturday, is in part attributed to high costs for animal feed, which is made with corn and soybeans.

Price for both grains have jumped to record levels in the past year, and though the company tried to save money by locking in prices with hedges, even that didn’t work as the prices have moderated slightly. Pilgrim’s Pride said it suffered “significant negative impact” of its hedged grain positions during the quarter.