Smithfield to Import Brazilian Corn
The world’s largest producer of pork, Smithfield Foods Inc. (NYSE: SFD) said today that it would begin importing corn from Brazil to use as feed for the company’s livestock. This is an unusual move for US food producers because the…
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But a report from MarketWatch cites a consultant who reported that corn at Brazilian ports is now selling for $290/metric ton compared with $345/metric ton on the US Gulf Coast. Shipping costs from Brazil add another $30-$40/metric ton to the cost.
Brazil anticipates a record crop this year of nearly 70 million metric tons, less than a quarter of the usual US production of more than 300 million metric tons. The US crop is being seriously damaged, though, by hot, dry weather in the nation’s corn-growing regions.
Other food producers have not revealed plans to import corn from Brazil or elsewhere, although Tyson Foods Inc. (NYSE: TSN), Hormel Foods Corp. (NYSE: HRL), and Pilgrim’s Corp. (NYSE: PPC) are likely candidates for consideration.
Shares of Smithfield are up 0.5% in the early afternoon today, at $18.26 in a 52-week range of $17.75-$25.12.
Paul Ausick
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Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.
He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.
