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Meat & Poultry Outlook

Meat & Poultry Outlook. Tyson Foods, Inc. February 24, 2012. Company Overview. Per Capita Consumption. Paradigm Shift. Old: Demand driven New: Producer profitability Increase in exports. Protein Production Drivers. Contract grower Feed conversion 1.92 : 1

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Meat & Poultry Outlook

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  1. Meat & Poultry Outlook Tyson Foods, Inc. February 24, 2012

  2. Company Overview

  3. Per Capita Consumption

  4. Paradigm Shift • Old: Demand driven • New: Producer profitability • Increase in exports

  5. Protein Production Drivers Contract grower Feed conversion1.92 : 1 3.7 bushels of cornto produce 100 lbs. of boneless skinless meat • Independent producer • Feed conversion3.5 : 1 • Approx. 8 bushels of corn to produce 100 lbs. of boneless skinless meat • Independent feedlot • Feed conversion7-9 : 1 • Yearling (750 lbs.) fed beef (300 lbs.) 11 bushels corn to produce 100 lbs. of boneless fed beef

  6. Corn Futures/Chicken Live Cost Live Cost ~ $0.45/lb. Live Cost ~ $0.35/lb. Live Cost ~ $0.25/lb.

  7. U.S. Corn Usage Source: USDA

  8. Energy Costs • Gas: Most expensive January ever • 2012: $3.37 • 2011: $3.10 • 2010: $2.71 • Diesel: 57% increase since 2007

  9. Meat & Poultry Demand • Prices increasing faster than inflation • Consumption declined slightly • Demand has increased

  10. Global Protein Consumption Metric Tons in Millions Source: USDA FAS and OECD. Includes Beef/Veal, Pork, Broilers, and Turkey

  11. Exports % of Production Exports Imports Protein Exports a Major Factor Chicken % of production Beef Pork Source: USDA and Robert A. Brown, Inc. January 30, 2012 2011 and 2012 are RAB forecasts

  12. International Operations

  13. Feeding the World • 70% more food needed • 9 billion people by 2050 • U.S.: less than 10% on food • ‘Agricultural illiteracy’

  14. Jobs in Agriculture • 22 million agriculture jobs • AgCareers.com: 40,000 jobs posted • Outdated stereotypes

  15. Regulatory Agencies - Issues • FSIS • GIPSA • FDA • EPA • DOT • OFCCP • Trade • EEOC • ICE • OSHA • USTR • Ethanol

  16. Purpose Statement

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