Smithfield Foods to Export Pork to China
An outbreak of a deadly disease among Chinese pigs has created a business opportunity for Virginia-based Smithfield Foods, which today announced an agreement to ship 60 million pounds of pork to China. Smithfield said it would deliver the pork by the end of December to an unnamed Chinese trading company. Financial terms were not disclosed in the company's statement.
Tens of thousands of pigs in China have died from the ailment, which is called blue ear disease, and farmers have slaughtered more than 100,000 animals in an effort to contain the outbreak. Pork prices have jumped sharply this year as supplies have tightened.
The disease, formally known as porcine reproductive and respiratory syndrome, leads to breathing and digestive problems, and can cause still births. Its informal name was coined because the ears of affected pigs turn blue.
Smithfield is one of the world's largest processors of pork, with sales of $12 billion last year. The company said Thursday that its first-quarter profit more than doubled, to $54.6 million from $24.6 million a year ago. Smithfield officials said today the export agreement could lead to additional business in China, which is the world's biggest consumer of pork.
"Although our agreement today is modest, we believe there could be additional purchases and we are hopeful that this is the beginning of a longer-term and growing association," said C. Larry Pope, Smithfield's chief executive, in a statement. "This is a milestone for Smithfield in terms of our business alliances in China and represents another step in our global expansion."
August 24, 2007; 2:58 PM ET
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