Tyson: Prices to jump as China cold storage supply depletes

Meat and poultry prices are already starting to move as a result of the African swine fever (ASF) outbreak in China, but once the country’s inventories in cold storage are depleted, prices should rise significantly, Tyson Foods CEO Noel White said.

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(Svilen Milev | Freeimages.com)
(Svilen Milev | Freeimages.com)

Meat and poultry prices are already starting to move as a result of the African swine fever (ASF) outbreak in China, but once the country’s inventories in cold storage are depleted, prices should rise significantly, Tyson Foods CEO Noel White said.

Speaking May 15 during the BMO Capital Markets Farm to Market Conference, White said the animal losses in the world’s largest pig producing and pork consuming country will affect trends involving all animal proteins. He said prices are moving higher, and exports are increasing, not only from the United States, but from other parts of the world to help meet the demand.

However, the biggest changes in prices are yet to come, he said.

“I think it will certainly bolster prices. It’s early in the process. If the numbers are accurate, there are sizeable inventories in cold storage in China, but those are expected to be depleted sometime over the next couple of months. And it’s really around that point in time that we will start seeing the meaningful escalation in prices,” said White.

Those changes will certainly have an impact on the diversified Tyson Foods, which is a major producer of pork, chicken, turkey and beef products.

Whites comments at the BMO conference came the week after he addressed the ASF situation during Tyson Foods’ second quarter earnings call on May 6. At the time, he referred to the outbreak as “unusual” and “perhaps unprecedented.”

“In my 39 years in the business, I have never seen an event that had the potential to change global protein production and consumption patterns as African swine fever does,” he said.

During the BMO conference, White and Tyson Foods Chief Financial Officer Stewart Glendinning also addressed the company’s venture into the plant-based protein sector.

View our continuing coverage of the African swine fever outbreak.

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