Smithfield Foods raised its annual operating profit forecast on Tuesday as its hog business rebounded from losses and the biggest U.S. pork processor said it resumed exports to China after a period of disruption. The Virginia-based meatpacker's sales and adjusted earnings in the three months to June 29 rose year on year, but shares fell about 1% after a drop in quarterly operating profits at its packaged meats and fresh pork divisions. Companies like Smithfield are facing cautious consumer demand due to inflation, with U.S. consumer prices rising and economists warning that higher prices from President Donald Trump's sweeping trade policies are still ahead. 'Consumer budgets remain tight,' Smithfield CEO Shane Smith told analysts on a call. To reduce risks in its hog business, Smithfield has reduced its own pig production and increased purchases from other producers, expecting to produce about 11.5 million hogs this year, down from 14.6 million in 2024. Livestock feed costs have also decreased due to low grain prices. The hog business swung to a quarterly operating profit of $22 million from a $2 million loss a year earlier. Smithfield projected total 2025 adjusted operating profit at $1.15 billion to $1.35 billion, compared with a previous forecast of between $1.10 billion and $1.30 billion. The company, which went public, is an indirect, majority-owned subsidiary of Hong Kong-based WH Group. Last week, Tyson Foods also raised its annual revenue forecast. Trump's trade policies have forced meatpacking executives to navigate tariff disputes. In April, Smithfield said China, the world's biggest pork consumer, was due to retaliatory duties. China's effective duty rate on U.S. pork climbed to 172% earlier this year before declining to 57% in May, according to the U.S. Meat Export Federation. 'We navigated the China tariff disruption, minimizing the impact by selling into alternative countries and channels, and subsequently resuming shipments to China,' Smith said. Smithfield said its 2025 outlook for fresh pork business addressed risks that tariffs could become prohibitive again. Quarterly operating profits for the fresh pork unit plunged by 39% to $35 million as sales rose 5% to $2.1 billion. Exports accounted for 13% of Smithfield's total sales last year, 3% of which were to China.

Smithfield Foods raises annual profit forecast as hog business recovers

Smithfield Foods has raised its annual operating profit forecast to $1.15 billion to $1.35 billion for 2025, driven by a recovery in its hog business, which swung from a $2 million loss to a $22 million profit in the quarter. The company resumed exports to China after navigating tariff disruptions, with China's effective duty rate on U.S. pork dropping from 172% to 57%. Despite a 39% decline in fresh pork quarterly operating profits to $35 million, sales rose 5% to $2.1 billion. Smithfield reduced its hog production to 11.5 million pigs in 2025 from 14.6 million in 2024 and increased purchases from other producers. The company cited lower livestock feed costs and cautious consumer demand due to inflation and trade policies under President Donald Trump. Tyson Foods also raised its annual revenue forecast amid ongoing trade tensions. Smithfield is an indirect, majority-owned subsidiary of Hong Kong-based WH Group.