Global swine disease could spell profit for Tyson.
Chicken provides alternative, but trade headwinds could diminish opportunity
Tyson Foods says it’s poised to take advantage of a hog disease in China that will ripple through the global protein industry, although it can’t say for sure when those benefits will start or how big they’ll be.
In an earnings release Monday, the top U.S. meat processor said swine fever could “impact the global protein industry on a level that we have never experienced.”
Tyson’s chicken business is set to benefit from China’s pig woes as consumers there look for cheap alternative proteins.
Still, the Springdale, Arkansas-based company is sticking Piglets feed at the Langfang pig farm. Tyson Foods sees an opportunity to grow chicken sales as swine fever hits in China.
with previous full-year guidance as higher hog costs counter pork-price gains. Tyson buys hogs for its pork and prepared foods segments.
Tyson, which beat the average analyst earnings on quarterly earnings, has stepped up its presence in prepared foods and value-added items and expanded overseas partly to cushion it from commodity price and cost swings.
The company’s shares were up 2.1 percent at 12:27 p.m. in New York, averting a market-wide selloff spurred by President Donald Trump’s tariff threats.
The stock has gained 44 percent this year as part of a rally by protein producers.
“Tyson’s business structure should translate to its ability to successfully navigate potential industry challenges and opportunities associated with African Swine Fever that may begin in 3Q and continue into fiscal 2020.”