Tyson Reduces Some Beef Prices as Coronavirus Pushes Grocery-Store Costs Higher
Tyson Foods Inc. is lowering some prices it charges supermarkets and restaurants for beef, after coronavirus-driven disruptions at meatpacking plants have led to a surge in meat costs.
The Arkansas company, which processes about one-fifth of the nation's beef, plans to reduce prices for ground beef, roasts and other beef products by as much as 20% to 30% for sales made this week to restaurants, grocery stores and other customers. The move will help keep beef affordable, said Noel White, Tyson's chief executive.
McDonald's Sets Conditions for Restaurant Reopenings
McDonald's Corp. is asking restaurant owners in the U.S. to make dozens of changes to ease coronavirus concerns before reopening their dining rooms, including commitments to clean bathrooms every half-hour and digital kiosks after each order.
The world's largest fast-food company by sales is also asking its hundreds of U.S. franchisees to enforce social distancing in its restaurants, and either close their public soda fountains or deploy a staff member to monitor them, according to a 59-page dine-in reopening guide viewed by The Wall Street Journal.
STORIES OF INTEREST
Uber-Grubhub Deal Promises Synergies, But Long Regulatory Review -- Market Talk
1007 ET - The proposed combination of Uber and Grubhub could generate $300M to $1.8B in synergies to combined adjusted earnings before interest, taxes, depreciation and amortization in 2021, UBS estimates, coming on top of the $150M in anticipated Grub adjusted EBITDA at that time. But, it adds, the deal could face lengthy antitrust review of six months to a year. For Uber, the deal, UBS recons, could potentially result in FY21 adjusted EBITDA of around $1.6bn "and likely pull forward Uber's path to profitability on both an Eats segment level and consolidated basis." (firstname.lastname@example.org)
More Than One-Third of Yum Shareholders Vote for Deforestation Resolution -- Market Talk
1505 GMT - More than one-third of Yum shareholders voted for a resolution that would compel the KFC and Taco Bell owner to pledge a no-deforestation policy from the commodities it sources, consumer advocacy group SumOfUs says. Despite Yum's disapproval of the resolution, the group says the proposal gained 35% support, up 3% from last year. "The message is clear, a growing number of shareholders are asking YUM! Brands to take immediate action on deforestation," says Fatah Sadaoui, campaign manager at SumOfUs. (email@example.com; @dieterholger)
Ausnutria Dairy's Growth Momentum Remains Strong -- Market Talk
0734 GMT - Ausnutria Dairy's revenue growth momentum appears strong despite the Covid-19 pandemic, with management indicating it may achieve the high end of its overall sales target this year, Daiwa says. Management is expecting to gain market share for infant milk formula products in 2020 as it shifts more of its marketing budget online. Traffic to mother-and-baby stores has recovered since April, which should help sales, the investment bank says. Daiwa raises its 2020-2022 revenue forecasts by 1%-2% and its target price to HK$20.30 from HK$17.00. The bank reiterates its buy rating. Shares gain 1.1% to HK$16.32. (firstname.lastname@example.org)
Livestock Futures Move Higher -- Market Talk
15:27 ET - After starting the day lower, livestock futures on the CME finished higher -- with lean hog futures up 1.5% to 58.75 cents per pound, while live cattle futures are up 0.3% to 94.125 cents per pound. Poor export sales reported by the USDA this morning sent livestock futures downward this morning, but they recovered into this afternoon as sentiment regarding optimism for increasing Chinese agricultural purchases. "Over the past several weeks the United States has seen a build in pork demand by China. Total Chinese exports are running at a record pace and a primary reason yearly shipments are up 116% from last year," says Karl Setzer of AgriVisor. (email@example.com; @kirkmaltais)
Estimated U.S. Pork Packer Margin Index - May 14
All figures are on a per-head basis.
Date Standard Margin Estimated margin
Operating Index at vertically -
May 14 +$159.36 +$110.28
May 13 +$166.35 +$116.71
May 12 +$155.55 +$106.65
* Based on Iowa State University's latest estimated cost of production.
A positive number indicates a processing margin above the cost of production of the animals.
This report compares the USDA's latest beef carcass composite
values as a percentage of their respective year-ago prices.
For Today Choice 205.4
(Percent of Year-Ago) Select 210.2
USDA Boxed Beef, Pork Reports
Wholesale choice-grade beef prices Thursday fell $15.07 per hundred pounds, to $450.92, according to the USDA. Select-grade prices rose 16 cents per hundred pounds, to $437.40. The total load count was 104. Wholesale pork prices fell $2.99, to $113.03 a hundred pounds, based on Omaha, Neb., price quotes.