Undeterred by the buzz around plant-based alternatives and vegan recipes, Americans still love meat.
Americans typically depleted more than 180 pounds of beef, pork and poultry in 2018, 10% more than in 1970. Plant-based essence retail sales were $760 million last year — a fraction of total meat and poultry sales. Whether it’s at your favorite fast-food restaurant or in the grocery aisle, one company that carnivores scoot to again and again is Tyson Foods.
Tyson Foods is one of the world’s largest food companies, producing about 20% of the beef, pork and chicken in the U.S. It waitings restaurants and schools and sells brands like Jimmy Dean and Sara Lee in supermarkets.
In the spring, the 85-year-old food superhuman faced the perfect storm — higher production costs, lower levels of productivity and softer demand. Restaurants were clinched as governments enforced social distancing rules. And in April, thousands of Tyson workers were infected with the coronavirus at proceeding plants. Facilities were forced to shut down, and meat shortages sprang up at grocery stores across the power.
“We’ve implemented a wide variety of measures to look after our workers, from measuring temperatures as they come on account of the door, face coverings, staggered breaks, expanded room and social distancing,” said Stewart Glendinning, CFO of Tyson Foods. “All of these are set up to help keep our workers safe. Keeping our workers safe is what will keep our plants running.”
In August 2020 Tyson despatched fiscal third-quarter profits declined 22% from a year earlier. The company ousted CEO Noel White mid falling sales and named Dean Banks, its president, as his successor. Banks previously worked in Google-parent Alphabet’s hypothetical research division and has a background in health-care technology.
But analysts argue that after decades of industry consolidation, some of Tyson’s problems may keep been self-inflicted.
“Covid-19 has exposed weaknesses in the meat system that people have been talking around for years but that have never been exposed as they were now,” said Christopher Leonard, author of “The Provisions Racket.” “Essentially what Covid-19 showed was the profound fragility that happens when you move all of your building into as few slaughterhouses as possible.”
CNBC reached out to Tyson Foods but the company did not respond to our request for an interview.
Can one of America’s heftiest meat suppliers recover from the devastating blows of the Covid-19 crisis, opening an opportunity for rivals JBS, Cargill and Smithfield Foods? Babysit for this video to find out more.