Hot weather cools Sanderson Farms' Q3 results
Net sales for the first nine months of fiscal 2010 were $1,396.3 million compared with $1,320.5 million for the first nine months of fiscal 2009. Net income for the first nine months of fiscal 2010 totaled $87.0 million, or $3.96 per share, compared with $62.5 million, or $3.00 per share, for the first nine months of last year.
“Sanderson Farms’ financial results for the third quarter of fiscal 2010 reflect favorable market conditions and solid execution in our operations, offset by the effect of the extreme heat on our live operations,” said Joe F. Sanderson, Jr., chairman and CEO. “Market prices for poultry products were lower than last year’s third quarter. Retail grocery store demand has remained strong, although foodservice demand has remained sluggish, and will likely remain that way until the employment market gains traction and more consumers return to restaurants. Overall, our operations continue to run well, resulting in solid operating margins for the third quarter. We were also able to benefit from slightly lower costs for corn and soybean meal, our primary feed ingredients, compared with the same period a year ago. Despite lower grain costs, live production costs were negatively affected by the extreme heat across our production areas. Heat negatively impacts live weights and feed conversions, which in turn results in fewer pounds processed and sold.”
According to Sanderson, overall market prices for poultry products were slightly lower in the third quarter of fiscal 2010 compared with prices in the third quarter of fiscal 2009. As measured by a simple average of the Georgia dock price for whole chickens, prices were relatively flat, showing a one percent decline compared with the third quarter of fiscal 2009. Driven by seasonal demand, boneless breast meat prices improved during the quarter, and averaged almost nine percent higher than the prior-year period, and averaged 7.9 percent higher for the first nine months of the year compared with the prior year. Jumbo wing prices weakened seasonally and averaged $1.07 per pound for the third quarter of fiscal 2010, down 19 percent from the average of $1.32 per pound for the third quarter of fiscal 2009. The average quoted market price for bulk leg quarters decreased approximately 22 percent for the quarter, reflecting weaker export sales. Cash prices for corn and soybean meal delivered to the company decreased 9.3 percent and 10.2 percent, respectively, compared with the third quarter a year ago. For the nine months ended July 31, 2010, corn decreased 8.4 percent and soybean meal increased 1.3 percent when compared to the nine months ended July 31, 2009.
“The development of our new Kinston, North Carolina, complex is moving forward on schedule,” added Sanderson. “We have moved into the hatchery, the feed mill will be completed soon, and we expect to begin processing birds in January 2011. We look forward to the new opportunities this plant will provide for Sanderson Farms, our employees, customers and shareholders.”
Source: Sanderson Farms Inc.
Americans eating their way through U.S. meat supplyRed meat supplies in storage have been reduced by 22 percent as Americans have spent the summer eating their share of beef and pork. Pork supplies were down in June 8 percent from May and 29 percent from the previous year. Among pork products, ribs were down 25 percent from last year and pork bellies were down 54 percent, reports the Des Moines Register. Beef supplies are down 16 percent.
The numbers from the USDA’s cold storage report show a rising demand in red meat, as well as the effects of an effort to thin the cattle and hog herds in response to low prices. Retail prices for beef and pork have risen modestly this summer. On the other hand, chicken products in storage are actually up 2 percent from last year.
Source: Des Moines Register
Registration opens for center-of-the-plate trainingRegistration is now open for the Center of the Plate Training Short Course, co-sponsored by the North American Meat Processors (NAMP) and the American Meat Institute Foundation (AMIF). The course will be held at Kendall College in downtown Chicago September 23-24, 2010.
Center of the Plate Training teaches participants about standards and specifications by demonstrating how the cuts commonly found in foodservice and retail are fabricated. Participants also learn about variations in quality and how standards can impact the consistency of meat products. AMI members are eligible for the lower members-only rate. In addition, if three people register, the fourth registration is free.
AMIF and NAMP are also partnering to offer the upcoming E. coli O157:H7 Conference for Beef Further Processors. This year’s conference, to be held September 28-29, 2010, in Chicago, will devote an entire morning to achieving validation for further processors.
Other topics that will be covered include a pre-harvest update, an FSIS policy update, a discussion of how science and the law affect the industry, information on suppliers and an overall HACCP plan update.
For more information and details, go to www.namp.com.