Blog: CEO departures signal turmoil in US meat
Dean Best | 6 January 2009
In just three weeks, two of the US meat industry's top executives have resigned – a sign perhaps of the problems in the sector.
Yesterday (5 January), Dick Bond, president and CEO of Tyson Foods stepped down from the helm of the world's largest meat processor.
Bond's departure follows hot on the heels of that of Clint Rivers, who, along with his chief operating officer, resigned from ailing US poultry giant Pilgrim's Pride just before Christmas.
The US meat sector has suffered from a perfect storm of rising commodity costs, an over-supply of chicken and weak consumer demand. That combination has led meat processors to scramble to cut costs, although the moves have failed to restore confidence in the sector. Pilgrim's entered Chapter 11 just before Christmas, while Tyson is using all of its assets as collateral for a fresh credit agreement.
While Tyson is in a far stronger position than Pilgrim's – thanks in no small part to its exposure to international markets – both companies have opted for experience as they look to navigate the turmoil in the sector.
Pilgrim's has now appointed Don Jackson, formerly president of Foster Farms' poultry division, as president and CEO, subject to approval by the US Bankruptcy Court for Texas.
Tyson, meanwhile, has hired former chairman and CEO Leland Tollett to run the company on an interim basis, until a permanent boss is chosen.
Experience will be key to both companies during what looks likely to be a tough 2009. Commodity prices have come off from last year's highs but the economic downturn is hitting consumer demand and therefore prices for meat.
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