Antibiotic-free chicken may boost profit at Tyson
June 26, 2007
Tyson Food Inc.’s decision to produce all of its branded chicken without antibiotics could spur growth at the poultry producer, reports The Wall Street Journal.
Last week the firm announced it would produce all of its branded retail chicken without antibiotics, a move that is expected to increase its poultry prices and boost its profitability.
“Over the longer term, Tyson’s new initiatives — ranging from increased advertising to the introduction of higher-priced branded chicken — could lead to stronger earnings and a higher valuation as investors stop viewing that company as a simple “protein” purveyor that supplies undifferentiated chicken, beef and pork to restaurants and retailers,” writes Karen Richardson.
Tyson said its “raised without antibiotics” campaign will lead to higher prices for all of its branded fresh chicken products. According to the Springdale, Arkansas-based company, 91% of consumers are interested in antibiotic-free chicken.
The National Chicken Council estimates that Americans will consume 87 pounds of chicken per person in 2007.