Smithfield Says Beef Unit Not Properly Structured
US - U.S. meat producer Smithfield Foods Inc. said on Wednesday its U.S. beef operations are not "properly structured" because its beef plants are not located near its cattle.
6 September 2007
1 minute read
"If you look at the feedlots they are in Colorado, Oklahoma and Texas and our plants are in Arizona, Wisconsin and Pennsylvania,"
Smithfield Chief Executive Larry Pope
"If you look at the feedlots they are in Colorado, Oklahoma and Texas and our plants are in Arizona, Wisconsin and Pennsylvania," Smithfield Chief Executive Larry Pope said during a presentation at a Lehman Brothers conference.
"The feedlots are nowhere near where our plants are, so we are not properly structured on the beef side," he said during the conference, which was broadcast over the Internet.
In addition to being the largest U.S. pork processor and hog producer, Smithfield also is the fifth largest U.S. beef processor and part-owner of the largest U.S. cattle feedlot operation.
Smithfield at one time was hoping to buy beef and pork company Swift & Co., which has beef plants in Texas, Colorado and Nebraska. But Swift was sold earlier this year to the Brazilian meat company JBS-Friboi (JBSS3.SA: Quote, Profile, Research).
"We did not buy Swift. So, we are reevaluating what we are going to do on the beef side of the business," he said.
Source: Reuters
