Hog production costs hurt Smithfield
05/06/2008
Sales for the most recent financial year at packer Smithfield Foods rose to $11.3 billion, from $9.3 billion a year ago, but the company has said market conditions and rising costs of livestock feed remain “challenging”, leading to earnings from sales of $139.2 million this year, down 34.3% from last year’s profits.
The company announced earlier this year that it was selling its beef processing and cattle feeding operations to JBS of Brazil, but its hog production is still proving an expensive operation to run.
Chief executive, Larry Pope, said on announcing the results: “Exceptional results in our pork operations were more than offset by extremely poor conditions in hog production. Domestic and export volumes were at record levels, and I am extremely pleased with the packaged meats side of our business, where we continue to drive out costs and improve margins.
“On the other hand, there were major challenges in the hog markets as live hog prices were low and grain prices were high. These were enormously difficult conditions.”
Share this story:
