New World Screwworm Invasion Exacerbates Rising Beef Prices
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 15 hours ago
0mins
Source: CNBC
- Beef Price Surge: The invasion of the New World screwworm has led to a 12.9% year-over-year increase in beef prices, despite a 1.27% decline in May, indicating a persistent upward trend that adds economic pressure on consumers.
- Supply Chain Crisis: The U.S. cattle herd has reached a 75-year low, and the arrival of the screwworm further disrupts ranchers' expansion plans, leading to tight beef supplies and anticipated price increases that will affect consumer purchasing power.
- Increased Demand for Substitutes: Consumers are turning to cheaper meat alternatives like chicken and pork in response to rising beef prices, and while beef demand remains at a 40-year high, this substitution trend may intensify as prices continue to rise.
- Significant Economic Impact: Cattle ranchers face additional labor and veterinary costs, which are expected to significantly impact producers' profits, ultimately passing these costs onto consumers and potentially leading to further increases in grocery beef prices.
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Analyst Views on TSN
Wall Street analysts forecast TSN stock price to rise
6 Analyst Rating
2 Buy
4 Hold
0 Sell
Moderate Buy
Current: 56.470
Low
58.00
Averages
65.20
High
75.00
Current: 56.470
Low
58.00
Averages
65.20
High
75.00
About TSN
Tyson Foods, Inc. is a food company. The Company has a portfolio of products and brands, including Tyson, Jimmy Dean, Hillshire Farm, Ball Park, Wright, State Fair, Aidells and ibp. Its segments include Beef, Pork, Chicken, and Prepared Foods. The Beef segment includes operations related to processing live-fed cattle and fabricating dressed beef carcasses into primal and sub-primal meat cuts and case-ready products. The Pork segment includes operations related to processing live market hogs and fabricating pork carcasses into primal and sub-primal cuts and case-ready products. The Chicken segment includes domestic operations related to raising and processing live chickens, and purchasing raw materials for fresh, frozen and value-added chicken products and sales of specialty products. The Prepared Foods segment includes operations related to manufacturing and marketing frozen and refrigerated food products and logistics operations to move products through the supply chain.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
New World Screwworm Invasion Exacerbates Rising Beef Prices
- Beef Price Surge: The invasion of the New World screwworm has led to a 12.9% year-over-year increase in beef prices, despite a 1.27% decline in May, indicating a persistent upward trend that adds economic pressure on consumers.
- Supply Chain Crisis: The U.S. cattle herd has reached a 75-year low, and the arrival of the screwworm further disrupts ranchers' expansion plans, leading to tight beef supplies and anticipated price increases that will affect consumer purchasing power.
- Increased Demand for Substitutes: Consumers are turning to cheaper meat alternatives like chicken and pork in response to rising beef prices, and while beef demand remains at a 40-year high, this substitution trend may intensify as prices continue to rise.
- Significant Economic Impact: Cattle ranchers face additional labor and veterinary costs, which are expected to significantly impact producers' profits, ultimately passing these costs onto consumers and potentially leading to further increases in grocery beef prices.
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- Leadership Transition: The appointment of Morris follows the retirement of Devin Cole, indicating a further adjustment in the executive team, as Morris previously served as president of Prepared Foods and Poultry, showcasing his extensive industry experience.
- Market Reaction: Despite the leadership changes, Tyson Foods' stock fell by 0.72% to $58.31 in the latest trading session, reflecting a cautious market response to the new COO's appointment.
- Future Outlook: Morris's appointment aligns with Jeff Schomburger's recent selection as the new CEO, indicating that the company is making strategic personnel adjustments to ensure long-term growth in the face of market challenges.
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- Classic Hot Dogs: Ball Park's new Jalapeño Beef Franks, made with 100% beef and designed to fit hot dog buns, are positioned to attract consumers during summer gatherings and game days, enhancing the brand's competitive edge in the market.
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New World Screwworm Invasion Exacerbates Rising Beef Prices
- Beef Price Surge: The invasion of the New World screwworm has led to a 12.9% year-over-year increase in beef prices, despite a 1.27% decline in May, indicating a persistent upward trend that adds economic pressure on consumers.
- Supply Chain Crisis: The U.S. cattle herd has reached a 75-year low, and the arrival of the screwworm further disrupts ranchers' expansion plans, leading to tight beef supplies and anticipated price increases that will affect consumer purchasing power.
- Increased Demand for Substitutes: Consumers are turning to cheaper meat alternatives like chicken and pork in response to rising beef prices, and while beef demand remains at a 40-year high, this substitution trend may intensify as prices continue to rise.
- Significant Economic Impact: Cattle ranchers face additional labor and veterinary costs, which are expected to significantly impact producers' profits, ultimately passing these costs onto consumers and potentially leading to further increases in grocery beef prices.
See More
Tyson Foods Appoints New COO Wes Morris Amid Leadership Changes
- Executive Appointment: Tyson Foods has appointed Wes Morris as Chief Operating Officer, effective June 15, bringing over 20 years of experience within the company, where he will oversee multiple business segments including Chicken, Beef, Pork, Prepared Foods, and International.
- Leadership Transition: The appointment of Morris follows the retirement of Devin Cole, indicating a further adjustment in the executive team, as Morris previously served as president of Prepared Foods and Poultry, showcasing his extensive industry experience.
- Market Reaction: Despite the leadership changes, Tyson Foods' stock fell by 0.72% to $58.31 in the latest trading session, reflecting a cautious market response to the new COO's appointment.
- Future Outlook: Morris's appointment aligns with Jeff Schomburger's recent selection as the new CEO, indicating that the company is making strategic personnel adjustments to ensure long-term growth in the face of market challenges.
See More
US Stocks Plunge Sharply, Tech Sector Under Pressure
- Market Decline: The S&P 500 fell 2.64% and the Nasdaq 100 dropped 4.77%, indicating a significant loss of investor confidence in tech stocks, particularly as AI infrastructure and semiconductor companies faced sell-offs, which could impact future investment strategies.
- Strong Employment Data: US nonfarm payrolls rose by 172,000 in May, significantly exceeding expectations of 88,000, while the unemployment rate held steady at 4.3%, potentially prompting the Fed to consider a rate hike at the upcoming meeting, thereby affecting market liquidity and investor sentiment.
- Rising Bond Yields: The 10-year Treasury yield climbed to 4.55%, a two-week high, reflecting heightened expectations for future rate hikes, which may lead to capital outflows from the stock market, further exacerbating market volatility.
- Tech Stock Retreat: Following Broadcom's disappointing chip sales outlook, Marvell and Micron stocks plummeted over 16% and 13%, respectively, suggesting that the market's overly optimistic sentiment towards tech stocks may be correcting, impacting investor confidence.
See More
Tyson Foods Unveils Summer Product Lineup
- Brand Expansion: Tyson Foods is launching several new products for the summer grilling season, including Wright's first-ever rope sausage available in three flavors, aimed at enhancing convenience and taste for family gatherings, thereby solidifying its position in the meat products market.
- Convenient Delicacies: Hillshire Farm's new smoked sausage ropes and links are fully cooked and ready in minutes, catering to the demand for quick meals and casual summer cookouts, thus meeting consumer needs for convenience in food preparation.
- Classic Hot Dogs: Ball Park's new Jalapeño Beef Franks, made with 100% beef and designed to fit hot dog buns, are positioned to attract consumers during summer gatherings and game days, enhancing the brand's competitive edge in the market.
- Celebratory Product: In celebration of America's 250th anniversary, Tyson is introducing limited-edition star-shaped chicken nuggets with festive packaging, providing 11 grams of protein per serving, suitable for various summer celebrations, showcasing the brand's innovation and market responsiveness.
See More
Tyson (TSN) Q2 2026 Earnings Call Transcript
See More
Goldman Sachs Adds Four Stocks to Conviction List
- New Stock Additions: Goldman Sachs added four stocks to its June conviction list, including Tyson Foods and Block, indicating strong confidence in these companies and reflecting its market outlook.
- Tyson Foods Outlook: Goldman praised Tyson Foods' diversified portfolio, projecting continued earnings growth with a price target of $81, representing nearly 33% upside from last Friday's close, underscoring its leadership in the U.S. meat market.
- Block Stock Performance: Goldman holds an optimistic view on Block, setting a price target of $95, which offers a 25% upside from last Friday, highlighting its potential in AI productivity enhancement and strong growth in the consumer finance sector.
- Growth Potential for TPG and Casella: TPG is seen as having a sustainable growth platform at a discounted valuation with a target price of $61, implying a 43% increase; meanwhile, Casella Waste Systems is expected to achieve margin expansion post-integration challenges, with a target price of $120, indicating a potential 46% rise, showcasing its competitiveness in waste management.
See More
