High chicken feed costs reduce Tyson profit
US-based Tyson Foods has reported lower-than-expected quarterly profit as higher feed prices produced a loss in its chicken unit.
Profitable performances in its red meats segments were overshadowed by sharp losses related to feed costs in its chicken business.
The company posted earnings of $9 mln in the 3 months ended 28 June, compared with earnings of $111 mln in the same quarter a year ago. Revenue in the third quarter rose to $6.8 bln, from $6.6 bln in the same quarter last year.
Tyson’s chicken segment suffered a $44 mln loss on $140 mln of grain costs. Tyson estimates that it will spend $550 mln more on grain costs in fiscal 2008 than it did in the previous year.
According to CEO Dick Bond, because the company spent only $350 mln of that through the first 3 quarters, 4th quarter results are expected to worsen. He also cited lagging prices in the breast-meat market.