Smithfield Foods now expects its Fresh Pork business to swing to an adjusted operating loss in the third quarter of 2026, as the USDA pork cutout has weakened further and compressed the industry's processing spread, according to a September 9 report from Reuters. The company also expects lower adjusted operating profit from its Hog Production business, and the update follows an August cut to its full-year 2026 outlook, when it lowered its adjusted operating-profit guidance to $1.23 billion-$1.38 billion from $1.33 billion-$1.48 billion and moved from low-single-digit sales growth to roughly flat sales. The weakness is concentrated in the commodity side of the business: packaged meats are performing in line with expectations, while Fresh Pork sales volume fell 2% and the average selling price declined 1.5% in the second quarter. Fresh pork sales to restaurants rose 12% in the second quarter, according to the Wall Street Journal, even as consumers bought less pork amid pressured household budgets and pork lost some preference to chicken and beef. Smithfield's second-quarter Fresh Pork cost of sales fell 2.6% on lower hog prices, but rising manufacturing, distribution, fuel and freight costs continued to absorb that benefit, and Tyson's own recent profit-outlook cut points to a broader protein-market squeeze.
Smithfield Foods, Inc. Common StockSmithfield expects its Fresh Pork business to swing to an adjusted operating loss in Q3 2026 as pork cutout weakened and processing spreads compressed, following an August cut to full-year 2026 profit guidance.
Tyson Foods IncTyson's own recent profit-outlook cut is cited as evidence of a broader protein-market squeeze affecting the sector.
