Pressure on chicken sales from an oversupply of red meat in the U.S. is beginning to ease, executives from Tyson Foods Inc. said Sept. 5.
In early August, Tyson said prices for beef and pork fell, leading supermarkets, food service operators and other customers to buy more beef and pork and fewer chicken products. That change, along with tariffs on meat Tyson exports to China, was part of the company's rationale for lowering its full-year 2018 EPS guidance.
That pressure now seems to be subsiding, with chicken sales stabilizing, President, CEO and Director Thomas Hayes told an audience at Barclays Global Consumer Staples Conference in Boston. He declined to provide specific figures, saying the company would wait until its fourth-quarter earnings report to provide details.
"Those things that gave us concern going into the [third-quarter] call... we've felt much better about that in the near-term," Hayes said. He added that the shift toward red meat and away from chicken was "unlike anything we've seen in the past."
Along with Tyson, Hormel Foods Corp. also lowered its guidance in August. The company cited lower pork prices as one of the reasons it decreased its sales forecast for its 2018 fiscal year.