Top stories for Feb. 19
Hormel turns in mixed first-quarter results
Hormel Foods announced that its first quarter volume was down 1 percent from last year and earnings of $81.4 million, an 8 percent decrease. However, dollar sales of $1.7 billion is up 14 percent from 2008, and certain segments of the company's business are performing strongly in today's economy.
“Despite a very challenging economic climate, our first quarter results leave us on track to meet our annual earnings guidance goal,” said Jeffrey Ettinger, chairman, president and CEO said. “Our Grocery Products segment had a solid quarter, led by strong canned meat sales. Our Jennie-O Turkey Store segment is doing a good job of addressing the difficult market conditions, including very weak commodity meat markets and higher input costs that continue to work their way through the system.”
The Grocery Products segment reported a 6 percent sales increase and a 9 percent increase in operating profit for the quarter compared to last year, boosted by strong sales of SPAM products, Dinty Moore Stews and Hormel chili. Operating profit for the Refrigerated Foods segment decreased 27 percent for the quarter, primarily attributable to a significant decline in the spread between hog costs and primal values. Value-added products sold well at the retail level, but Hormel has seen a decrease in foodservice sales. Operating profit for Jennie-O Turkey Store was down 16 percent in the first quarter, though sales of value-added products here also helped minimize the decline from a year ago.
Source: Hormel Foods
Beef Checkoff program looks at beef demand factors
“U.S. Beef Demand Drivers and Enhancement Opportunities: A Research Study,” a new study by the Beef Checkoff Program, states that there is no single demand driver that the beef industry should focus on. Rather, the industry is dynamic and flexible, and is responsive to many outside factors.
The study was conducted by Dr. James Mintert and Dr. Ted Schroeder, professors in the Department of Agricultural Economics at Kansas State University along with Dr. Glynn Tonsor from Michigan State University.
The report states that increasing beef demand does not just happen at the retail level. “It requires a joint effort by all vertical segments of the beef production, processing and marketing chain or, as is commonly said, from pasture to plate. This offers plenty of opportunities for checkoff programs to make an impact on beef demand,” the BCP states.
Mintert notes in the study that a 1 percent increase in consumer expenditures results in a 0.9 percent increase in the quantity of beef demand. While the current economy may result in a decrease of beef demand, price is not solely responsible for the increase or decrease in beef demand. Consumers are looking for a product that meets their needs, so the industry must continue to offer a product that is nutritious, flavorful, tender, safe, healthy and convenient.
Food safety plays a key part in maintaining beef demand, as the increase in food safety recalls led to a 2.7 percent decrease in beef demand in 2007. “As the industry develops programs designed to improve beef demand, ensuring consumers have a safe supply of beef is critical to maintaining consumer confidence,” Mintert reports. “A cooperative effort among vertical market participants is essential to protecting food safety and beef’s image among consumers.” New product innovation is also integral to maintaining beef demand. Mintert reports that for every new convenience beef product released there are 1.6 new product released in the poultry sector.
The full report is available at www.mybeefcheckoff.com.
Source: Beef Checkoff Program
Pilgrim's Pride to sell grain elevator
Northwest Tuna Trollers enter agreement for Eco Certification
The Western Fish Boat Owners Association (WFOA) and the Canadian Highly Migratory Species Foundation (CHMSF), have completed a collaborative funding agreement to undertake a full assessment for Marine Stewardship Certification for North American North Pacific Albacore Tuna.
MCS-certified seafood can be traced back to a sustainable fishery, enabling consumers around the world to make the best environmental choice in seafood.
WFOA director, Wayne Heikkila said that certification was a necessary step for the Association with many retailers and restaurants buying only product carrying the MSC logo, including Sainsbury's in the UK. Wal-Mart has also pledged to make a full switch to certified fisheries by 2011.
“It's a global market and the MSC logo is an internationally recognized symbol of good management and sustainability,” says Heikkila. “We pride ourselves on our environmental record and this is an effective way to communicate it to our customers around the world.” On successful certification, the two Organizations may apply to display the Marine Stewardship Council Eco-Label on their products.
WFOA member-vessels have been trolling for albacore for almost a century in the Pacific Northwest. The WFOA is a non-profit association representing more than 400 family-owned albacore fishing vessels, fishermen and supporting businesses. They are involved in fisheries' management issues at the state, federal, and international level. The CHMSF is a non-profit association offering the same representation for the Canadian albacore fishing industry.
Source: Western Fish Boat Owners Association