Tyson Foods back to 'near-normal' operations in Asia

Tyson Foods may have felt the impact of the COVID-19 pandemic in Asia before it started feeling it in the United States, but company leaders say things are returning to normal for its Asian operations.

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(Nick Julia | Bigstock)
(Nick Julia | Bigstock)

Tyson Foods may have felt the impact of the COVID-19 pandemic in Asia before it started feeling it in the United States, but company leaders say things are returning to normal for its Asian operations.

COVID-19’s impact in China

Speaking during a quarterly earnings call on May 3, Tyson Foods President Dean Banks said Tyson’s China operations were impacted by COVID-19 more than any other region during the second quarter of the 2020 fiscal year. The quarter concluded on March 28.

Tyson Foods CEO Noel White, speaking during a conference call with reporters two hours after the earnings call, offered more detail on the situation in China.

“Initially when it first broke in China, it did affect our operations within China as our team members came back off Chinese New Year. The impact lasted a matter of weeks, anywhere from 2 to 4 weeks, White said. “That business and volume has largely recovered.”

According to White, the present situation in the United States with strong sales in retail and e-commerce but slow sales at the foodservice level is very similar to the way it was in China earlier in the year. But, he added, “the foodservice business is in the process of recovering.”

Banks added that despite the challenges COVID-19 brought in China, Tyson’s “China team produced record sales and operating income as production was shifted to meet rising retail demand.”

Elsewhere in Asia

White also discussed the COVID-19 pandemic’s impact on its operations in Thailand, Malaysia and South Korea, which were obtained through Tyson Foods’ 2018 acquisition of Keystone Foods and the purchase of certain BRF assets in 2019.

“The lockdown that took place in southeast Asia was very quick and severe, and there was tracing that took place for anyone who did in fact test positive,” said White. “Those plants were impacted for a matter of weeks. … We worked with the government(s) for those plants to come back up, and they’ve resumed near-normal operations at this point.”

Tyson Foods, through the BRF transaction, also acquired facilities in Europe. White said operations in Europe have been a “little bit slower to come back.”

Tyson Foods’ international segment went from an operating loss of $7 million during the second quarter of 2019 to an operating income of $9 million for the most recent quarter.

Also during the conference call with journalists, White addressed the pandemic’s impact on the company’s poultry operations in the United States. Unlike some companies, White said Tyson Foods has not had to depopulate any flocks due to decreased production at processing plants.

View our continuing coverage of the coronavirus/COVID-19 pandemic.

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