Tyson Foods Navigates Trade War, Raises Profit Forecast
Tyson Foods Inc. is addressing the impact of Donald Trump's trade war, which threatens to hinder pork exports to Mexico. The company is exploring alternative markets to mitigate the potential disruption.
"We have been preparing for this," said CEO Donnie King. "We will leverage our global presence to find the best markets for our products."
Mexico, the largest importer of U.S. pork, has prepared counter-tariffs against the U.S. after Trump proposed 25% levies. President Claudia Sheinbaum has delayed the move by a month.
Despite trade risks, Tyson has raised its 2025 profit outlook. A rebound in its chicken business has fueled earnings that surpassed first-quarter estimates.
Tyson's shares surged as much as 3.8% in New York. Earnings per share reached $1.14 for the quarter ending December, a 65% increase and higher than analyst expectations. This marks the strongest quarterly performance in over two years.
The company increased its adjusted operating income forecast for 2025 by $100 million to a range of $1.9 billion to $2.3 billion, considering potential restrictions on exports to Mexico and Canada.
The first-quarter results reflect a recovery in the U.S. chicken industry, boosted by lower feed costs and increased consumer demand. Tyson's poultry business recorded adjusted operating profits of $368 million, doubling from the previous quarter and also exceeding estimates.
However, Tyson faced a $32 million loss in its beef business due to cattle shortages and rising slaughter costs.