CHICAGO - Tyson Foods Inc, the largest U.S. meat producer, said on Wednesday its chicken business has softened since early August, while its beef and pork businesses are doing well.

Tyson, like other meat companies, continues to recover from a rough 2008 and early 2009, when high feed and fuel prices increased production costs and a recession slowed meat sales here and overseas.

Tyson Chief Executive Leland Tollett said the company's chicken business has softened but the company's other meat segments are operating as expected.

The chicken business is a little bit soft, beef and pork have been very good. Tollett said at the Barclay's Capital Back to School Consumer Conference.

Tyson, like other meat companies, responded to these pressures by cutting production and costs and by shortening sales contracts to more quickly pass on the higher costs.

We are making progress in improving these chicken operations even more than we have up to now, he said. I like the way things are shaping up for our entire business operation.

The recession has consumers eating more at home and Tyson officials said supermarket sales remain strong and food service business weak.

In August, Tyson reported a third quarter profit of $134 million, or 35 cents a share, but for the nine months it still had a loss of $82 million, or 22 cents. A year ago earlier, it has $38 million profit, or 11 cents a share, for the nine months.


In export markets, Tyson said China continues to buy chicken, while sales of beef and pork to South Korea have slowed.

There have been industry reports that China, angered by a U.S. ban on imported Chinese chicken, has reduced such purchases. But Tyson officials said the Chinese market remains open.

In terms of exporting into China right now, everything is good. Prices are normal and there is still good strong demand for our product, Donnie King, group vice president for refrigerated and deli foods, said of chicken exports.

Pork sales to Russia have improved after being slow early in the summer, said Noel White, Tyson senior vice president for pork margin management.

Pork sales to China are down from a year ago, but that country continues to buy, while pork sales to South Korea have softened, said White.

Beef exports to South Korea also have slowed and are a little weaker than what we'd like to see, he said. Beef sales to China, Russia and other countries have been relatively stable.

(Reporting by Bob Burgdorfer; Editing by David Gregorio)