Tyson says pork exports to China soared nearly 600% in first quarter after swine fever outbreak
Tyson has also announced a restructuring that will lead to 500 job cuts. Tyson Foods Inc. says it’s just starting to see the benefits of the African swine fever outbreak in China, which includes a 600% year-over-year increase in pork orders to China in the fiscal first quarter.
The meat producer says it is moving toward a ractopamine-free hog supply, which should open additional markets for its pork products. Ractopamine is a feed additive that is banned in many countries.
“In fact, global demand for all proteins is increasing as African swine fever continues to reduce pork supplies in Asia,” said Noel White, chief executive officer, on the company’s earnings call last week.
Tyson reported fiscal first-quarter sales that missed expectations, though earnings per share beat the FactSet consensus. Tyson also anticipates double the demand for chicken in China. In addition to earnings, Tyson Foods has disclosed in a regulatory filing that it will cut about 500 jobs, mostly from its corporate offices in Springdale, Ark. and Chicago, as part of a restructuring that was approved in the first fiscal quarter of 2020.
The restructuring will result in a $44 million pretax charge, though the meat producer does not anticipate any future charges associated with the program. Tyson also expects savings of $55 million in fiscal 2020 and $65 million in 2021.
Tyson stock has tumbled 11.4% for the year to date, but is up 32% over the last year. The S&P 500 index SPX, -0.06% has gained 22.7% over the past 12 months.