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Tyson to aggressively grow poultry business

Tyson's chicken business experienced a tough time in 2008, but signs of improvement are breaking through, says senior group vice president Poultry & Prepared Foods, Donnie Smith.

"Industry indicators are turning in our favour a bit now if you look at the egg sets in hatcheries, chicks placed on farms and the pounds produced," Smith said. "Across our industry, we’re down about 6% versus where we were a year ago. We’re seeing an impact from that on market prices ...the industry fundamentals are improving."

Smith believes that it's necessary for the company to focus on "getting its fundamentals back to where they need to be". "It’s very much a ‘back-to-basics’ approach in our poultry business."

New and value-type products

In looking at the tough economic time and the impact it has had on Tyson’s poultry business, Smith said, "We are seeing consumers turn a little more often to retail for their food choices. If you look in the foodservice industry, full-service dining has struggled a bit. The limited-service dining area, however, has weathered the storm fairly well driven primarily by new products and also by value-type products, which in many cases we helped them develop."

Smith went on to say that the retail market gives Tyson an opportunity to capitalize on consumer behaviour. "We offer various different alternatives using our prepared-foods products and our value-added products to help consumers as they move that trend back toward retail," he said.

Fresh chicken business

In terms of Tyson’s fresh chicken business, Smith states that the company is doing very well. "Our branded share of growth has grown both in dollar sales and in volume sales. The value-added segment has struggled a bit as consumers are looking for less-expensive alternatives to stretch their food dollars. Fortunately last fall, we lowered our bag weights in our retail value-added line, which helps keep our price points down and keeps our products well within reach of shoppers looking for a value solution."

Smith concludes on a strong note: "Over the course of the last few years, we have given up market share across the poultry industry and we simply can’t do that any more. We’ll be aggressively trying to grow our business. I think we’ll be gaining share as we do so."

Natalie Berkhout

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