'Back to Basics' Approach is Working for Tyson

US - Changes in supply and demand have created challenges for Tyson's beef sector, but according to the company, they are managing well.
calendar icon 14 May 2009
clock icon 1 minute read

Jim Lochner, Senior Group Vice President of Tyson Fresh Meats, addressed the BMO Capital Markets 2009 Agriculture, Protein & Fertilizer Conference in New York City, noting Tyson's beef and pork segment generated financial returns at or near normalized levels during the second quarter of fiscal 2009.

"While changes in supply and demand have created challenges for our business, we believe we've done a good job of managing the spread between what we pay for livestock and the price we receive for our finished products," Mr Lochner said.

In beef, he noted cattle hide and beef tallow prices have been weak, demand for expensive cuts has been soft and excess beef trim supplies have put downward pressure on pricing. However, he also reports live cattle values have generally reflected the revenue decline.

Mr Lochner expects adequate supplies of fed cattle for the summer and fall, and anticipates dressed beef carcass weights to continue to be above year-ago levels and the five-year average. Because demand does not appear to support last year's volumes, he predicts weekly slaughter rates will remain below year ago levels.

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