“While market conditions improved during our third fiscal quarter compared to last year’s third quarter, the Company and our industry face a challenging environment going forward,” added Sanderson. “Market prices for grain are at historic highs, and ongoing drought conditions across much of the country have created considerable uncertainty regarding this year’s corn and soybean crops. While the quantity available and prices we will pay for grain during the coming months will ultimately depend on this year’s final crop performance, prices are certain to be much higher than those paid for grain this fiscal year. Based on current markets, cash paid for feed grains would be approximately $61.1 higher during fiscal 2012 compared to fiscal 2011. We have priced little of our grain needs going forward, and will remain on the market for our needs for now.”“While market prices for chicken remain higher than they were last year and have strengthened over the past few weeks, they are not high enough to offset what we now expect to be significantly higher input costs during the coming months. In light of these costs, beginning August 6, 2012, we reduced our egg sets by two percent across all Company divisions to lessen the impact of the higher grain costs we are facing. This reduction was in addition to the four percent reduction started January 1, 2012, and we will run our plants at six percent below capacity until market conditions improve.”
Sanderson Farms, Inc. Reports Results For Third Quarter Of Fiscal 2012
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