Tyson Foods 2009 Annual Report Download - page 5

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COMPETITION
Our food products compete with those of other national and regional food producers and processors and certain prepared food
manufacturers. Additionally, our food products compete in markets around the world.
We seek to achieve a leading market position for our products via our principal marketing and competitive strategy, which includes:
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identifying target markets for value-added products;
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concentrating production, sales and marketing efforts to appeal to and enhance demand from those markets; and
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utilizing our national distribution systems and customer support services.
Past efforts indicate customer demand can be increased and sustained through application of our marketing strategy, as supported by
our distribution systems. The principal competitive elements are price, product safety and quality, brand identification, breadth and
depth of the product offering, availability of products, customer service and credit terms.
INTERNATIONAL
We exported to more than 90 countries in fiscal 2009. Major export markets include Canada, Central America, China, the European
Union, Japan, Mexico, the Middle East, Russia, South Korea, Taiwan and Vietnam.
We have the following international operations:
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Tyson de Mexico, a Mexican subsidiary, is a vertically-integrated poultry production company;
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Cobb-Vantress, a chicken breeding stock subsidiary, has business interests in Argentina, Brazil, the Dominican Republic,
India, Ireland, Italy, Japan, the Netherlands, Peru, the Philippines, Spain, Sri Lanka, the United Kingdom and Venezuela;
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Tyson do Brazil, a Brazilian subsidiary, is a vertically-integrated poultry production company;
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Shandong Tyson Xinchang Foods, joint ventures in China in which we have a majority interest, is a vertically-integrated
poultry production company;
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Tyson Dalong, a joint venture in China in which we have a majority interest, is a chicken further processing facility;
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Jiangsu-Tyson, a Chinese poultry breeding company, is building a vertically-integrated poultry operation with production
expected to begin in fiscal 2011;
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Godrej Tyson Foods, a joint venture in India in which we have a majority interest, is a poultry processing business; and
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Cactus Argentina, a majority interest in a vertically-integrated beef operation joint venture in Argentina; however, we do
not consolidate the entity due to the lack of controlling interest.
We continue to explore growth opportunities in foreign countries. Additional information regarding export sales, long-lived assets
located in foreign countries and income (loss) from foreign operations is set forth in Note 20, “Segment Reporting” of the Notes to
Consolidated Financial Statements.
RESEARCH AND DEVELOPMENT
We conduct continuous research and development activities to improve product development, to automate manual processes in our
processing plants and growout operations, and to improve chicken breeding stock. In 2007, we opened the Discovery Center, which
includes 19 research kitchens and a USDA-inspected pilot plant. The Discovery Center brings new market-leading retail and
foodservice products to the customer faster and more effectively.
ENVIRONMENTAL REGULATION AND FOOD SAFETY
Our facilities for processing chicken, beef, pork and prepared foods, milling feed and housing live chickens and swine are subject to a
variety of federal, state and local environmental laws and regulations, which include provisions relating to the discharge of materials
into the environment and generally provide for protection of the environment. We believe we are in substantial compliance with such
applicable laws and regulations and are not aware of any violations of such laws and regulations likely to result in material penalties
or material increases in compliance costs. The cost of compliance with such laws and regulations has not had a material adverse effect
on our capital expenditures, earnings or competitive position, and except as described below, is not anticipated to have a material
adverse effect in the future.
Congress and the United States Environmental Protection Agency are considering various options to control greenhouse gas
emissions. It is unclear at this time when or if such options will be finalized, or what the final form may be. Due to the uncertainty
surrounding this issue, it is premature to speculate on the specific nature of impacts that imposition of greenhouse gas emission
controls would have on us, and whether such impacts would have a material adverse effect.