June 1, 2010

Smithfield Foods may see profits this year

Smithfield Foods Inc., the world's largest pork-processor, may be profitable in hog production this year after losing US$1.4 billion from raising pigs over three years, Chief Executive Officer C. Larry Pope said.

The company may earn US$10-$15 per hog this year, Pope recently in New York. Hog production may remain profitable for the next one to two years, because US supplies have declined and prices have rebounded.

The hog-breeding herd maintained by the Smithfield, Virginia-based company has been cut by 13% since early 2008. High feed costs and shrinking pork demand because of the recession and swine flu have spurred losses for US producers.

"We have absolutely no plans to expand any of our sow herds," Pope said. "One of the things we may have to address is even further reduction in our sow counts because I think the productivity on the farms will improve."