Seaboard Corporation reported another quarter of profitability for its investment in Butterball.
For the first quarter of fiscal year 2023, ending on April 1, Seaboard reported $25 million in income from Butterball, which is up from the $16 million in income from the same three-month period of 2022, according to a Form 10-Q on the Seaboard Investor Relations webpage.
The company attributed that increase primarily to higher margins, partially offset by lower volumes of pounds sold and $19 million in other non-operating income recorded in the first quarter of 2022.
“The higher margins were primarily due to a 17% increase in sales prices due to general commodity pricing and a stronger mix of value-added products. The other non-operating income recorded in the first quarter of 2022 primarily included the gain on the sale of business,” the company stated.
After numerous consecutive quarters of losses on Butterball, the turkey business returned to profitability during the first quarter of 2022 and has continued to bring profits to Seaboard. That is a trend the company said it expects to continue for the remainder of the year, although it did not elaborate as the company’s management is unable to predict market prices for turkey products or the cost of feed for future periods.
The Form 10-Q was dated May 3 and signed by David H. Rankin, executive vice president and chief financial officer of Seaboard Corporation.
Seaboard owns a majority non-controlling stake in Butterball.
Butterball, headquartered in Garner, North Carolina, is the largest turkey producer in the United States, having regained that position after slipping to become the country’s second largest turkey company during the previous year, according to the WATTPoultry.com Top Poultry Companies Database.
In 2021, Butterball slaughtered 1.06 billion pounds of live turkeys, compared to 1.2 billion pounds slaughtered by Jennie-O Turkey Store. However, amid the highly pathogenic avian influenza (HPAI) outbreak, both companies saw reduced production in 2022. Despite the outbreak, Butterball was able to slaughter 1 billion pounds in 2022, compared to 925 million from Jennie-O.
Cargill Protein, the nation’s third largest turkey producer, held steady with 900 million pounds slaughtered during each of the two years.
