TOP STORIES
Tyson Says Labor, Grain Costs Boost Meat Prices
Tyson Foods Inc. projected higher meat costs ahead, as the meat company seeks to pass along elevated prices for animal feed, increased wages and ongoing pandemic expenses to restaurants and supermarkets.
"We've seen unprecedented and accelerating inflation and we're trying to catch up with that," said Tyson Chief Executive Donnie King, on a conference call with reporters.
Sanderson Farms to Sell Itself for $4.53B
Sanderson Farms Inc. has agreed to sell itself to a joint venture between Cargill Inc. and agricultural-investment firm Continental Grain Co. for $4.53 billion, the companies said.
The deal values Sanderson at $203 a share, about 30% above the price before The Wall Street Journal reported in June that the company had attracted interest from suitors including Continental. The Journal on Sunday reported that the companies were nearing a deal.
Tyson Says Cavalry Coming to Chicken Breeding Farms -- Market Talk
10:17 ET - Underperforming male chickens have been identified as the culprit in Tyson Foods' struggles to boost poultry production to meet surging demand for wings and chicken sandwiches, but CEO Donnie King says help is on the way. A new and more vigorous male is making its debut on the breeding farms that Tyson uses to produce eggs for its hatcheries, and ultimately the farms that raise its chickens. "We have converted some of the male stock and we have seen some results," says King, who adds the conversion of Tyson's male breeders to the higher-performing birds will complete this fall. Shares rise 6% to $75.36. (jacob.bunge@wsj.com; @jacobbunge)
STORIES OF INTEREST
As Chicken Sandwiches Take Wing, Beef Boosts Tyson Foods -- Market Talk
0910 ET - The story in the restaurant world this year has been all about crispy chicken sandwiches, but it's burgers that boost top US meatpacker Tyson Foods. Tyson's beef earnings jumped nearly 23% to $1.1B for the company's F3Q, far surpassing improvement in the company's core chicken operations and a decline in its pork earnings. Tyson credits strong demand for its beef boom, and more stable operations relative to the quarter ended June 27, 2020, during which Covid-19 infections disrupted beef plants. (jacob.bunge@wsj.com; @jacobbunge)
Meat Price Tags Going Higher, Tyson Foods Says -- Market Talk
1007 ET - Tyson Foods says it's getting more expensive to produce chicken nuggets, pork chops and steaks, and its customers need to be prepared to pay more, too. Tyson CEO Donnie King says the biggest US meat supplier has increased its prices for restaurants and supermarkets to offset higher cost of animal feed, Tyson's need to increase wages and benefits to keep plants staffed, and higher transport costs. Tyson's also dealing with ongoing Covid-19 expenses, which cost the company $55M in the most recent quarter. "We've had inflation on all inputs," King says. CFO Stewart Glendinning says discussions on pricing with customers have been constructive so far. (jacob.bunge@wsj.com; @jacobbunge)
FUTURES MARKETS
Covid Pressure Sends Hogs Lower -- Market Talk
1515 ET - Lean hog futures trading on the CME close down by the limit of 3 cents per pound, dropping 3.4% to 84.6 cents per pound. For hogs, the main pressure point is the spread of Covid-19 variants in China--a key customer for US exports. "The protein complex has struggled... on Chinese demand fears as the supply of hogs prepares to seasonally increase," says Arlan Suderman of StoneX. Meanwhile, live cattle futures close down 0.3% to $1.27475 per pound.(kirk.maltais@wsj.com; @kirkmaltais)
(END) Dow Jones Newswires
08-09-21 1714ET
