The thesis of this article is that Seaboard Corporation (NYSEMKT:SEB) stands to markedly benefit from the anticipated acquisition of Smithfield Foods (NYSE:SFD) by Shuanghui International.
First I will demonstrate that the Smithfield acquisition will cause rising pork prices in the United States. The primary reason for this is that, as Smithfield's CEO Larry Pope put it, "this [the acquisition] is about exporting meat products from the U. S to China." If more pork leaves the United States then prices will rise. While American pork exports to China have already been increasing fairly rapidly throughout the 21st century, I believe that the Smithfield acquisition marks an acceleration of this trend.
Second, Seaboard is uniquely positioned to...
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