Sanderson Farms expects to process 3.13B pounds of chicken in FY14 Says FY13 financial results put company in position to resume growth strategy for FY14. In FY14, the company expects to process 3.13B pounds of chicken, which is a 2.5% increase of pounds processed compared to FY13. Sees FY14 CapEx $58M, modeling an effective tax rate of 34.9%. Expects to spend $110M in FY14 for new Texas facility and expects to spend $140M overall for the new facility. The company sees the cost of grain in FY14 $194M lower than in FY13. Sees market conditions for next year continuing to reflect weakness in consumer spending. Comments made during the company's Q4 earnings conference call.
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Sanderson Farms continues to see weak food service demand Cites macroeconomic conditions and weather-related effects from Q1. Weather also forced the company to close several plans in the last week of January due to ice and snow. Grain prices have moved higher during February as a result of USDA's lower than expected corn carryout estimate. The company expects market conditions in retail grocery store market to remain strong as chicken will compete during 2014 with high priced beef and pork. It does not see a significant increase in domestic chicken production until 2H of 2014 at the earliest. Grain costs in 2014 will be lower by $153M compared to 2013. Sanderson Farms also announced that it remains on schedule to begin operations at its new Palestine, Texas facility during the first calendar quarter of 2015.