Tyson: profit slide, pork business doing well
US pork, chicken and beef producer Tyson Foods reported that the
skyrocketing price of poultry feed hurt its business in the latest quarter,
triggering a 92% drop in profits.
The company warned that rising grain costs could lead to more losses in its
The chicken unit suffered from a $44 million loss in the
fiscal third quarter, compared to a $95 million profit in that same period in
2007, as prices for corn and soybeans rose rapidly after flooding damaged crops
and delayed plantings in the United States.
According to Tyson, the
company paid $140 million more for grain during the quarter to feed its poultry
compared to last year. In addition, it is expected that grain costs will cost up
to $550 million this fiscal year.
The Tyson pork
business wasn't hit as hard, since Tyson buys swine for its beef and pork
operations, contrary to its poultry business - which are raised by the company
and consequently have to be fed.
Operating income for Tyson's Pork
business was $54 million compared to $37 million during the third quarter of
fiscal 2007. Sales for the segment during the quarter were $926 million compared
with $857 million during the previous year.
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