February 7, 2020
Tyson Foods increases US pork exports to China
The company is meeting increased demand for pork in China, but reported missed quarterly sales projections, reported Reuters.
Amid the African swine fever outbreak dwindling pork supplies and the new coronavirus, Noel White, Tyson chief executive said China's demand for pork continues to be strong.
White said there are plans to increase more pork exports to China, with the first quarter reporting close to 600% year-on-year increase.
He added that the company is also exporting pork to other countries, whose normal supply chains are affected by China's increased pork purchases.
Even though retaliatory tariffs on US pork from China remain in place, US exports to both China and Hong Kong hit 110,857 tonnes in December 2019. According to industry figures, this was four times more compared to 2018.
China is expected to cut additional tariffs imposed on US goods by half after signing the Phase 1 US-China trade deal.
White said once China lifts or reduces current tariffs, exports for pork, beef and chicken is projected to rise further.
Tyson shares dropped 3%, its lowest in three months as the company is looking to restructure, eliminating 500 jobs.
Tyson reported a net income of US$557 million or US$1.52 per share in the first quarter ended December 28, 2019. This is higher than the US$551 millionor US$1.50 per share in the same period in 2018.
According to IBES data from Refinitiv, Tyson sales increased 6.1% to US$10.82 billion, lower than the US$11.04 billion projected by analysts. Tyson earned US$1.66 per share as per estimations.
Volume sales of beef dropped 8%, as Tyson's cattle processing was hampered by a fire at its slaughterhouse in Kansas. The facility has resumed operations.