Agricultural News
Tyson Executive Sees Improving Meat Demand in at Least the Short Term
Wed, 18 May 2011 4:43:36 CDT
According to reports from the website Meatingplace.Com, a Tyson Foods executive believes that meat demand may not plunge as anticipated following what he described as a period of adjustment this after we have seen protein demand actually on the rise in recent weeks and higher prices being anticipated.
Noel White, Tyson's senior group vice president of fresh meats, told an audience at the BMP Capital Markets Farm to Market Conference in New York at the beginning of this week that one would expect demand to fall with rising prices, that historically hasn't been the case.
"There's always a period of adjustment with higher price levels," White said. "In this case, it's not just one protein that's going to cost more, but all of the proteins will be moving higher in price through the rest of 2011 and into 2012."
White added that not all of the higher costs have been passed along to consumers so far, adding that producers have been absorbing a lot of the increase costs. But he noted that retailer margins continue to be squeezed tightly and that will eventually be felt on store shelves during the year.
Tyson CEO Donnie Smith told the same group that sales of beef, pork, and chicken improved in the last two weeks following a cold, wet April and record high corn prices.
"We had a late Easter and bad, rainy weather in April, but demand (for protein) is improving," Smith told the conference audience. "We had planned for soft demand, but we can see good results despite continued unemployment, higher grain prices and higher costs for gasoline and energy."
Smith added that the high corn prices will continue to have an impact on protein, especially as planting so far this year is well below spring 2010 levels (63 percent vs. 87 percent last year) and floods man-made and natural aren't helping. Smith also noted that 2011 is the fourth consecutive year of reduced domestic protein availability as beef exports continue to rise. He cited USDA estimates that per-capital domestic availability for beef, pork, chicken and turkey will drop to 263 pounds this year, down 7.4 percent from 2006 levels.
Click here for a news release from Tyson on the comments made by Noel White on the outlook for the protein business.
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