Smithfield, Tyson Decline Amid Swine-Flu Outbreak (Update1)
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By Choy Leng Yeong

April 27 (Bloomberg) — Smithfield Foods Inc., the world’s largest pork processor, and Tyson Foods Inc. fell in New York trading on speculation that the swine-influenza outbreak will decrease consumption of pork.

Smithfield declined $1.37, or 13 percent, to $8.95 at 10:05 a.m. in New York Stock Exchange composite trading. Tyson dropped $1, or 9.1 percent, to $9.93.

Consumers have begun to ask fresh-meat departments at groceries around the country whether pork can transmit the virus, Ken Goldman, a JPMorgan Chase & Co. analyst, wrote today in a note. Goldman lowered his estimates for Tyson and Smithfield earnings this year.

“Though there is no evidence that swine flu can be obtained by eating pork, the fear generated by a disease named after hogs cannot be good for pork consumption,” Goldman said.

Smithfield said yesterday that it has found “no clinical signs or symptoms” of swine influenza in its swine herd or its employees at its joint ventures in Mexico. Keira Ullrich, a spokeswoman for Smithfield, didn’t immediately return a message seeking comment today.

Springdale, Arkansas-based Tyson, which got about 13 percent of its revenue from pork in its previous fiscal year, will have an operating loss of about 23 cents a share in its current fiscal year, compared with an earlier estimate for profit of 22 cents, Goldman said. Gary Mickelson, a Tyson spokesman, didn’t return a message seeking comment.

Smithfield, based in the Virginia city of the same name, will have an operating loss of $1.68 a share in the current fiscal year, wider than an earlier projection for a $1.51 loss, he said.

Mexico Outbreak

The number of deaths from Mexico’s flu outbreak has risen to 103, and cases have been reported in the U.S., Canada and Spain. New Zealand said as many as 13 students may have swine flu.

Swine flu is a respiratory disease of pigs caused by type-A influenza that regularly leads to outbreaks among the animals, according to the U.S. Centers for Disease Control and Prevention. Three main human flu strains — H3N2, H1N1 and type B — circulate and cause 250,000 to 500,000 deaths a year in seasonal epidemics, according to the World Health Organization.

Swine-flu viruses aren’t transmitted by food, and eating properly handled and cooked pork and pork products is safe, according to the CDC.

To contact the reporter on this story: Choy Leng Yeong in Seattle at clyeong@bloomberg.net.