In comments Tuesday to the annual Consumer Analyst Group of New York, Tyson Foods, Inc. president and chief executive officer Richard L. Bond says the company is strategically positioned for future success. The executive’s upbeat assessment comes despite the impact of escalating grain prices and other market-related challenges.
“We’ve accomplished a great deal in our efforts to make Tyson a stronger, more agile company and believe we have the right strategies in place to win,” said Bond. “We’re confident about our future because of our efforts to optimize our commodity businesses, create new products, expand our international presence and increase the value of our by-products.”
Tyson reported increased sales of $1.5 billion in fiscal 2007 and operating income of $700 million despite incurring $300 million in additional grain costs. The company also reduced debt by $1.2 billion.
“We currently believe we’ll experience almost $800 million in increased grain and related input costs in fiscal 2008,” said Bond. Feed costs have risen sharply due to the U.S. focus on corn-based ethanol production. Approximately 25% of the U.S. corn crop is expected to be used in 2008 to produce ethanol, compared to only 8% in 2002.
Tyson continues to push for changes in the government mandate on corn-based ethanol and the removal of tariffs on sugar-based ethanol imports. Bond added, “According to a recent report, even if the entire U.S. corn crop were turned into ethanol, it would displace only 3.5% of gasoline use.”
Source: Tyson Foods news release