The U.S. Department of Agriculture [USDA] reversed an earlier decision to allow poultry producer Tyson Foods to label its chicken products "raised without antibiotics." The reversal was sent to Tyson in a November 6 letter. Tyson has spent millions of dollars since June in advertising, promoting itself as the "first major poultry company to offer fresh chicken raised without antibiotics on a large-scale basis." The USDA's reversal came after the agency discovered Tyson uses ionophores, a common chicken feed additive designed to prevent an intestinal colonization by coccidia that causes weight loss (and occasionally death) in poultry. Tyson argues ionophores are an antimicrobial, not an antibiotic, and thus they should be allowed to continue labeling their poultry "raised without antibiotics." Tyson shares are down 32% since receiving "antibiotic free" label approval earlier this year.
Commentary: Tyson Continues to Point to Food Inflation • Tyson Swings to Q4 Profit, But Tanks on Disappointing Guidance • 100 Stocks to Offset Rising Food Prices
Stocks to watch: TSN. Competitors: PPC, SFD, HRL
Earnings call transcript: Tyson Foods F4Q07 (Qtr End 9/29/07)
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