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<SEC-DOCUMENT>0000091388-09-000045.txt : 20090914
<SEC-HEADER>0000091388-09-000045.hdr.sgml : 20090914
<ACCEPTANCE-DATETIME>20090914171633
ACCESSION NUMBER:		0000091388-09-000045
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20090914
ITEM INFORMATION:		Results of Operations and Financial Condition
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20090914
DATE AS OF CHANGE:		20090914

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			SMITHFIELD FOODS INC
		CENTRAL INDEX KEY:			0000091388
		STANDARD INDUSTRIAL CLASSIFICATION:	MEAT PACKING PLANTS [2011]
		IRS NUMBER:				520845861
		STATE OF INCORPORATION:			VA
		FISCAL YEAR END:			0427

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-15321
		FILM NUMBER:		091068121

	BUSINESS ADDRESS:	
		STREET 1:		200 COMMERCE STREET
		STREET 2:		EXECUTIVE OFFICE BUILDING
		CITY:			SMITHFIELD
		STATE:			VA
		ZIP:			23430
		BUSINESS PHONE:		7573653000

	MAIL ADDRESS:	
		STREET 1:		200 COMMERCE STREET
		STREET 2:		EXECUTIVE OFFICE BUILDING
		CITY:			SMITHFIELD
		STATE:			VA
		ZIP:			23430

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	LIBERTY EQUITIES CORP
		DATE OF NAME CHANGE:	19710221

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	LIBERTY REAL ESTATE TRUST
		DATE OF NAME CHANGE:	19661113
</SEC-HEADER>
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COMMISSION</font></font></div>
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365-3000</font></font></div>
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Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions (</font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">see </font><font style="DISPLAY: inline; COLOR: #000000">General Instruction A.2.
below):</font></font></div>
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  230.425)</font></font></div>
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      pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
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      pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
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</font></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Section
2 &#8211; Financial Information</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Item
2.02&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Results
of Operations and Financial Condition.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
September 8, 2009, Smithfield Foods, Inc. held a public conference call to
discuss its financial results for the first quarter of fiscal 2010, which ended
August 2, 2009. The Company has included in the presentation EPS information
adjusted for two significant charges because it uses, and believes that others
may use, such information in comparing the Company's operating results from
period to period. However, the items excluded in such calculation are
significant components in understanding and assessing the Company's overall
financial performance for the period covered. The transcript of the conference
call is furnished herewith as Exhibit 99.1.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Section
9 &#8211; Financial Statements and Exhibits</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Item
9.01&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Financial
Statements and Exhibits</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div>&#160;</div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt">
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99.1&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Transcript of earnings
release conference call on September 8, 2009.</font></div><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div><br>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">SIGNATURES</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Pursuant to the requirements of the
Securities Exchange Act of 1934, the Registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly
authorized.</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div>
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            <tr>
              <td align="left" valign="middle" width="41%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="middle" width="46%">
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      INC.</font></font></div>
              </td>
            </tr>
            <tr>
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      </font></td>
              <td align="left" valign="top" width="23%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr>
            <tr>
              <td align="left" valign="middle" width="41%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="23%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="23%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr>
            <tr>
              <td align="left" valign="middle" width="41%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="23%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="23%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; COLOR: #000000">Date: September 14,
      2009</font></font></div>
              </td>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; COLOR: #000000">/s/ Michael H.
      Cole</font></font></div>
              </td>
              <td align="left" valign="top" width="23%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr>
            <tr>
              <td align="left" valign="middle" width="41%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="middle" width="46%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; COLOR: #000000">Michael H.
    Cole</font></font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="middle" width="41%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; COLOR: #000000">Vice President, Chief Legal
      Officer and Secretary</font></font></div>
              </td>
            </tr>
        </table>
      </div>
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INDEX</font></div>
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                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Exhibit
      99.1</font></div>
              </td>
              <td>
                <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Transcript
      of earnings release&#160;conference call on September 8,
    2009.</font></div>
              </td>
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<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>ex99-1.htm
<DESCRIPTION>TRANSCRIPT SMITHFIELD FOODS EARNINGS CONFERENCE CALL FY10 Q1
<TEXT>
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      <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
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        <div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 12.55pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #00339a; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #00339a">FINAL TRANSCRIPT</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 12.55pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #00339a">SFD - Q1 2010 </font><font style="DISPLAY: inline; COLOR: #00339a">Smithfield</font><font style="DISPLAY: inline; COLOR: #00339a"> Foods Earnings Conference
Call</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 12.55pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 12.55pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #00339a; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #00339a">C O R P O R A T E P A R T I C I P A N T
S</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 12.55pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Keira Ullrich</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-STYLE: italic; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Smithfield Foods, Inc. - Director
IR</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-STYLE: italic; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Smithfield Foods, Inc. - President and
CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Bo Manly</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-STYLE: italic; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Smithfield Foods, Inc. &#8211;
CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 12.55pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #00339a; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #00339a">C O N F E R E N C E C A L L P A R T I C
I P A N T S</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 12.55pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Ken Goldman</font></font></div>
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Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Christine McCracken</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Cleveland</font><font style="DISPLAY: inline; COLOR: #000000"> Research &#8211; Analyst</font></font></div>
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Analyst</font></font></div>
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Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Christina McGlone</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-STYLE: italic; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Deutsche Bank &#8211;
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        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Reza Vahabzadeh</font></font></div>
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Analyst</font></font></div>
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Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Farha Aslam</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-STYLE: italic; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Stephens Inc. &#8211;
Analyst</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 12.55pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #00339a; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #00339a">P R E S E N T A T I O
N</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Operator</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Ladies and gentlemen, thank you for
standing by, and welcome to Smithfield Foods first quarter earnings call. At
this time, all</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">participants are in a listen-only mode.
Later, we will conduct a question and answer session. Instructions will be given
at that</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">time. (OPERATOR INSTRUCTIONS) As a
reminder, this conference is being recorded.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I would now like to turn the conference
over to Keira Ullrich. Please go ahead.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Keira
Ullrich </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Smithfield Foods,
Inc. - Director IR</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Good morning. Welcome to the conference
call to discuss Smithfield Foods' first quarter fiscal 2010 results. We would
like to</font></font></div><br>
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        </div><br>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">caution you that in today's call there
may be forward-looking statements within the meaning of federal securities laws.
In light</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">of the risks and uncertainties involved,
we encourage you to read the forward-looking information section of the
Company's</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">10-K for fiscal year 2009. You can
access the 10-K and our press release on our website at
www.SmithfieldFoods.com.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">On our call today are Larry Pope,
President and Chief Executive Officer; Bo Manly, Chief Financial Officer; and
Dick Poulson,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Executive Vice President. This is Keira
Ullrich, Director of Investor Relations. In order to provide the opportunity to
as many </font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">analysts as possible to ask questions
during the Q&amp;A session later in our call, we request that you ask only one
question and</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">one follow-up, if
necessary.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Larry Pope will begin our call this
morning with a review of operations. Larry?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Thank you, Keira, and thank you for
dialing in this morning. I realize it's the first day after the holiday and a
long summer and I</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">hope you had an opportunity this summer
to try many of our products, like our barbecue ribs or hot dogs and BLT, never
goes</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">bad in summertime. Maybe that's a sign
of the fall.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I'm here this morning to report that we
had sales of $2.7 billion versus $3.1 billion, which is a decrease from the
prior year. I</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">won't get into that much except to say
Mr. Manly will discuss that in terms of where it is from a pricing standpoint
and a volume</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">standpoint, some of this of which we
have orchestrated and have been talking about for some time. In terms of loss
from</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">continuing operations, we are reporting
a loss of $107.7 million compared with $29.1 million last year in the same
quarter. On</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">an EPS basis, that's $0.75 a share loss
compared with $0.22 a share last year.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I hope you took note in the press
release of a couple of one-time items that did come through the P&amp;L, the
closing of some of</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">our hog production operations, again,
Mr. Manly will speak more directly to, as well as some write-off of some loan
amortization</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">associated with refinancing. Those
totaled about $0.19 a share, bringing the total down to $0.56 cents, which many
of you have</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">already picked up.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">In addition, we have about $6 million of
restructuring charges that are going through the P&amp;L that we did not
highlight as part</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">of the press release. And as well, many
of you know that we had a devastating fire in one of our major plants in
</font><font style="DISPLAY: inline; COLOR: #000000">Cudahy</font><font style="DISPLAY: inline; COLOR: #000000">, </font><font style="DISPLAY: inline; COLOR: #000000">Wisconsin</font><font style="DISPLAY: inline; COLOR: #000000">,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">and as well, the inefficiencies and the
costs associated with that have been somewhat significant, yet hard to
determine. And</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">those are also going through this
P&amp;L.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">And finally, we have an abnormally low
tax rate, which as well had an impact on the quarter. From our standpoint, the
quarter</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">was substantially better than the $0.75
that you're seeing, even substantially better than the $0.56 that you're seeing.
No question</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">that the results reflect the continuing
adverse environment in hog production. This has been going on. All of you who
follow</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the Company are fully aware of this. We
continue to live with the impact of high grain costs last summer, which we fed
the last</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">of that really the end of April, and
those costs are now coming through the inventory being sold and that's coming
through</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the P&amp;L, which is creating a
loss.</font></font></div><br>
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        </div><br>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I think Bo will speak pretty clearly
about how we think all that's ending this quarter, the second quarter, and we do
see our costs</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">coming down. As well, our costs, as we
commented in the press release, are down for the quarter, down from the prior
quarter,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">down from the prior year, but they are
not where they are going to be. We reflected $162 million loss in hog production
versus</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">only a $39 million loss last year. That
does have $34 million related to the write-off of some farms in that number, so
you need</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">to make that adjustment when you're
looking at the numbers in terms of hog production.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Productivity has been excellent. We've
had good weather. We've had very good instances of low disease. Our livability
numbers</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">are doing extremely well. So from an
operations standpoint, to some degree, that's a negative because that means a
lot of hogs</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">are being produced. But from a business
standpoint of operating the hog farms, that part of the business is doing
extremely</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">well.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">As you know, we have announced another
reduction in our sow herds from 10% to 13%. That has virtually been
accomplished.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I haven't checked this morning but we
should be at the very very end of that other 3%, and essentially we are 13% down
on</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the sows as of now.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I think you're aware that the hog market
was sharply lower. That is, to some degree, the result of the H1N1 virus that
hit at the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">very end of the fourth quarter and that
certainly immediately depressed the live hog market, as well as some of the
fresh meat</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">results as a result of the export
markets closing and the impact of dumping meat back on the </font><font style="DISPLAY: inline; COLOR: #000000">US</font><font style="DISPLAY: inline; COLOR: #000000"> markets and that related
impact</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">back on the hog market. I will tell you,
and I'll make some comments as I look forward, we do remain committed to this
end of</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the business, although we are reducing
our exposure and many things are going in the right direction from, we believe
hog</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">prices going up to costs going down,
corn going down from a strong corn crop this fall. So in spite of these horrible
results in</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the hog production side, it does look
like the business is trending up and there is a glimpse of a hope that the sow
liquidation</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">is occurring.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">On the fresh meat side, we're reporting
a loss compared with a profit last year. That is the result of the H1N1 virus.
Many of the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">major cuts are down 10%, 20%, 30% and
40% below last year's levels as a result of marketing this product back on the
</font><font style="DISPLAY: inline; COLOR: #000000">US</font><font style="DISPLAY: inline; COLOR: #000000"> market.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">We continue to have very high levels of
slaughter and that results in an awful lot of fresh meat in the market. I think
you all</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">know that the export markets are
somewhat politically motivated and the </font><font style="DISPLAY: inline; COLOR: #000000">China</font><font style="DISPLAY: inline; COLOR: #000000"> market, which has been a source of a
lot of</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the exports for many, many, many years
is closed. We don't think there's scientific basis for that, but it's there, and
that's impacting</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">our operations some $5 or $6 a head in
terms of the offal items that we routinely put into that market. </font><font style="DISPLAY: inline; COLOR: #000000">Japan</font><font style="DISPLAY: inline; COLOR: #000000"> as well was spooked</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">at the beginning of the quarter and that
has impacted the exports into </font><font style="DISPLAY: inline; COLOR: #000000">China</font><font style="DISPLAY: inline; COLOR: #000000">. Beyond that, the export market
actually is pretty</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">good. Several of the other countries are
actually doing very well. So while it may sound like things are terrible on the
export</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">market, they are not. It's just
essentially one country and a little in the Japanese market. Overall, exports
are actually fine.</font></font></div>
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        </div><br>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I want to turn your attention now to the
highlight of the release, which is the packaged meats business. We indicated to
you</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">this quarter we would start breaking
those numbers out and we've done that. If you look, we're reporting $107.8
million versus</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">$34 million in our packaged meats, our
packaged meats business, that segment of the total pork group. And I am
extremely</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">pleased with those numbers and I think
we're approaching 9% on return on sales. I think if you compare those with
our</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">competition, you will see that we are
equal to or better than others. This is an area of the business that I have been
talking about</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">and talking about and talking about. Our
numbers are extremely good. This is the area we are extremely optimistic
about.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">We're reporting the operating earnings
of three times last year's numbers. They are a record for the quarter, they're
nearly a</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">record period. And it does reflect the
benefit of some cheap raw material. But we are just beginning to really see the
benefit of</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">our restructuring plan and those are
really not in these numbers in any measurable way. And as I indicated earlier,
there are $6</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">million of restructuring charges largely
coming through that line.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">As well, we've got the fire that we had
the Fourth of July weekend that affected our packaged meats business and all the
costs</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">associated with immediately relocating
product has gone through this line item. And I am happy to report this
management</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">team responded instantly to that. All of
our customers were served and we continued to ship all of our customer needs in
spite </font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">of a very significant fire that will
have longer term impacts in terms of our packaged meats business. And we've got
to decide</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">ultimately how we're going to react to
that, but it has been significant. Yet even with that, I am pleased that we're
delivering</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">these kinds of
numbers.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Let me turn your attention for a second
to the restructuring. This is something we announced, as you know, some six
months</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">ago. It is going extremely well. Five of
the six plants are closed, the seventh plant is right on schedule for right at
the end of the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">calendar year. We fully expect to
achieve a savings. As we've indicated, we are on time and on budget. Our capital
expenditures</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">for that are right on the numbers. In
terms of the costs for the quarter, they were below what we thought they would
be and</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the savings that we achieved for the
quarter were more than we expected. So from an implementation standpoint,
the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">restructuring is going better than we
thought it would go and it did positively impact the quarter as opposed to
negatively</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">impacting it, as we had
expected.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">We are in the midst of an SAP
implementation across the organization. That is more than 50% complete. It will
be completed</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">here by the end of the calendar year or
virtually completed. We are having the typical bumps in the road, although they
are</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">really insignificant from a financial
reporting standpoint. It's the typical things you have with SAP when you have to
go from A</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">to Z and if you skip any step in
between, it doesn't like printing an invoice. But it's the right thing for us to
do. We're not even </font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">highlighting any impact of that going
through the P&amp;L. That's how comfortable we are that we're making the
conversion across</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">what is a very complicated system. And
it is going well and will position us extremely well once this thing is fully
implemented.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">On the international front, we reported
a number of our operating companies over there are doing very well in spite of
the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">recession. </font><font style="DISPLAY: inline; COLOR: #000000">Poland</font><font style="DISPLAY: inline; COLOR: #000000">, </font><font style="DISPLAY: inline; COLOR: #000000">Romania</font><font style="DISPLAY: inline; COLOR: #000000">, </font><font style="DISPLAY: inline; COLOR: #000000">Spain</font><font style="DISPLAY: inline; COLOR: #000000">, </font><font style="DISPLAY: inline; COLOR: #000000">Mexico</font><font style="DISPLAY: inline; COLOR: #000000">, they are all profitable. And while the
number is only showing a $7.3 million versus</font></font></div><br>
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        </div><br>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">a 5.9 million comparison, that has some
fairly significant currency losses, translation losses, in there of roughly
another $6 million,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">so it would have really been $13 million
versus $6 million. So that part is going very, very well. I'm very pleased in
spite of a</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">worldwide recession, our international
operations are actually doing pretty darn good.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">In the other category, that's really our
turkey operations and the cleanup of our cattle operations that we sold out this
quarter.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">That's showing a reduced loss. The
turkey business is improved, although we are not where we need to be on the
turkey side</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">of the business.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Finally, the financing, which Bo will
speak to on a more lengthy basis, I'm very pleased with the job we've done. I
think we have</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">shored up the balance sheet, although I
was not so worried. I think we've demonstrated the ability to have access to the
capital</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">markets and refinanced a couple of
billion dollars. It did come at a cost and increased interest expense, but we've
eliminated</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the covenants and I think positioned the
Company from a maturity standpoint to weather the future pretty darn
good.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">With that being said, I'm going to turn
it to Bo and then I'll give you some comments on the future once Bo's complete.
Bo?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Thank you, Larry. Good morning,
everyone. It's been a busy quarter in </font><font style="DISPLAY: inline; COLOR: #000000">Smithfield</font><font style="DISPLAY: inline; COLOR: #000000"> for the finance and accounting
departments.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">We have refinanced over $2 billion of
debt while addressing critical issues of liquidity, covenant risk and pending
maturities.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">We sold $625 million five-year secured
10-year notes in July. Simultaneously, we completed a $1 billion ABL revolving
credit </font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">facility replacing our previous $1.3
billion domestic revolver. Concurrently, we negotiated a new term loan agreement
effectively</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">extending the maturity of our $200
million term loan from fiscal 2012 to 2014. In August, subsequent to the quarter
end, we</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">upsized the bonds issued in June by $225
million for a total of $850 million in new bonds. We use these funds, plus cash
on</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">hand to repay the balance remaining of
our $225 million euro denominated European revolver.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Our balance sheet and ABL created cash
on hand and available liquidity of over $1.15 billion at quarter end, the
strongest</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">position ever for </font><font style="DISPLAY: inline; COLOR: #000000">Smithfield</font><font style="DISPLAY: inline; COLOR: #000000">. We anticipate paying the remaining
$206 million October 2009 bonds with cash on hand. Following</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">this payment, we will have effectively
no </font><font style="DISPLAY: inline; COLOR: #000000">US</font><font style="DISPLAY: inline; COLOR: #000000"> maturities until fiscal 2012. Clearly,
we have removed significant balance sheet</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">risks relative to liquidity, covenants
and maturities.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">This flexibility has not come cheap,
particularly in these unusual credit markets. Our annual adjusted interest
expense and fees</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">is expected to rise from $222 million
last year to between $270 million and $275 million this fiscal year. Larry has
described in</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">detail the proactive steps we've taken
to reduce our exposure to commodity risks by reducing our sow herd by 13%, with
the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">last phase taking place in this recent
quarter. The last reduction was the result of the wind-down of the PSF Texas
farm operation.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Efforts are ongoing as well to sell the
Coffey farms in </font><font style="DISPLAY: inline; COLOR: #000000">Missouri</font><font style="DISPLAY: inline; COLOR: #000000"> with approximately 20,000 sows. These
proactive steps have</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">required the Company to take a noncash
$34 million pretax write-down of hog production assets.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Smithfield</font><font style="DISPLAY: inline; COLOR: #000000"> experienced a loss of $108 million
during the first quarter of fiscal 2010 compared to a loss of $13 million in the
same</font></font></div><br>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">period a year ago. This loss on the
quarter just ended translates to a loss per share of $0.75. In addition to the
noncash $34</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">million write-down of hog assets
mentioned earlier, we also recorded a $7 million charge related to early debt
cancellation. If</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">our earnings per share are adjusted for
these two significant charges, we show a non-GAAP EPS of $0.56 per
share.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">The operating profits from the pork
segment were $101 million for the first quarter of fiscal 2010 compared with $62
million</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the same period a year ago. We are
extremely pleased that for the first time this quarter, </font><font style="DISPLAY: inline; COLOR: #000000">Smithfield</font><font style="DISPLAY: inline; COLOR: #000000"> is able to separate the results
</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">of fresh and packaged meats within the
pork segment. This provides transparency to the outside world and
competitive</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">comparability not previously available.
Packaged meats contributed operating profits of $108 million for the quarter,
over a</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">200% increase compared to the same
quarter last year. The packaged meats improvements were driven by restructuring
efforts</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">to lower overhead, margin enhancements
through sales coordination and consolidation, as well as lower cost of raw
materials.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Fresh pork results reflected moderate
losses for the period as recessionary pressures, particularly international,
affected demand</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">more negatively in fresh than branded
and packaged meat sales.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">The hog production segment showed a $162
million loss for the quarter compared to a $39 million loss for the first
quarter last</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">year. These results were below the
Company's expectations. The summer hog price rally never occurred, a victim of
H1N1 flu</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">and recession. Rather than an expected
seasonal rise, the </font><font style="DISPLAY: inline; COLOR: #000000">Iowa-</font><font style="DISPLAY: inline; COLOR: #000000">Southern </font><font style="DISPLAY: inline; COLOR: #000000">Minnesota</font><font style="DISPLAY: inline; COLOR: #000000"> prices fell $0.01 from $0.43 per pound
in</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the fourth quarter of fiscal 2009 to
$0.42 in the quarter just ended, and $0.56 cents in the same quarter a year ago.
Hog production</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">costs did decline in the first quarter
as predicted, from $0.63 cents in the quarter end in April to $0.59 cents in the
recent quarter.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">The decline in rise in grazing costs
reflected lower corn prices. Costs in the quarter we are now in are expected to
decline further</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">and fall to the $0.50 cents per pound
range by the second half of the year.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">The first quarter fresh pork and
packaged meats sales declined year-over-year due both to lower volume and lower
fresh pork</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">selling prices. The international
segment saw sales increases in their home currencies. However, changes in
exchange rate</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">reversed those increases when translated
to dollars. Hog production sales fell due to lower hog prices and fewer heads
sold to</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">third parties. Other segment sales
increased due to the inclusion of cattle sales. Consolidated operating profits
for the quarter</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">declined from $3 million a year ago to a
loss of $75 million, principally caused by the $162 million loss in hog
production, more</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">than offsetting strong improvements in
packaged meats. The international segment demonstrated improved operating
profits,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">as </font><font style="DISPLAY: inline; COLOR: #000000">Poland</font><font style="DISPLAY: inline; COLOR: #000000">, </font><font style="DISPLAY: inline; COLOR: #000000">Romania</font><font style="DISPLAY: inline; COLOR: #000000">, </font><font style="DISPLAY: inline; COLOR: #000000">Mexico</font><font style="DISPLAY: inline; COLOR: #000000"> and Campofrio all showed improved
operating results before currency gains and losses.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">SG&amp;A declined 4% quarter over
quarter due to currency changes, lower compensation, and marketing expenses. The
adjusted</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">interest rate this quarter was $161
million compared to $45 million in the same quarter a year ago. This 34%
increase was caused</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">principally by $5 million in new
interest related to the $625 million bond issue and $6 million related to the
convertible bonds.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">As I stated earlier, we anticipate our
annual interest expense to be between $270 million and $275
million.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Please note that as an important
housekeeping item that we were required to adopt a new accounting rule this
quarter that</font></font></div><br>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">affected the accounting for convertible
debt that we issued last summer. The rule requires issuers of convertible debt
to reflect</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">interest expense at a market rate rather
than the coupon rate, in our case 4%. The rule change also required us to
reflect the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">debt at a discount on the balance sheet
with a corresponding increase in equity. An extensive footnote on our 10-Q will
cover</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the effect of this
change.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">With regard to other balance sheet
issues, debt increased $444 million during the quarter, due to capital markets
transactions.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">The debt to capitalization ratio
increased from 54% at the end of the prior quarter to 56% at the end of this
quarter. If the debt</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">to cap ratio was expressed on a net of
cash basis, however, our ratio at the end of the recent quarter would have been
52% due</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">to large cash balances. The Company
remains committed to reducing the debt to capitalization ratio below 50% within
the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">next 24 months.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">The Company anticipates paying the
remaining $206 million of our 2009 bonds from cash on hand lowering the debt to
cap</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">ratio. We have no current applicable
covenants at the end of the quarter. We have no current applicable covenants at
the end</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">of the quarter. Larry, I didn't know I
would ever be able to say that.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Depreciation for the quarter was $61
million compared to $69 million in the first quarter of the prior year. We
anticipate $260</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">million of depreciation for the full
year. Capital expenditures for the last quarter remained at a bare minimum
maintenance</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">level of $34 million. Full year CapEx
will remain under tight control at or less than $200 million. The tax rate for
the quarter was</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">25% and we anticipate full year tax rate
between 34% to 36%. A word of caution, tax rate calculations during quarters
with</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">highly fluctuating profits and losses
will produce unusual tax rate percentage calculations. The Company's hedging
activities</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">contributed a loss of $48 million during
the first quarter of fiscal 2010 compared to a profit of $3 million in the same
period a year </font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">ago. Our infamous corn hedge contributed
a $59 million loss, more than offsetting profits in hog hedges. The final
$20</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">million of the $6 corn hedge losses will
run off in the second quarter of hog production P&amp;L. Please bear in mind
that losses on</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">these hedge positions were cashed out
and paid several months ago and today represent noncash charges to the income
statement.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">The cumulative effect of the capital
markets transaction bolstered the Company's cash and short-term borrowing
capacity. We</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">ended the quarter with over $1.15
billion in liquidity to include $500 million in cash. Liquidity today remains
over $1 billion</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">after paying off the European revolver
in August shortly after the end of the quarter.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">In July, the Company experienced a
devastating fire at our Patrick Cudahy plant in </font><font style="DISPLAY: inline; COLOR: #000000">Wisconsin</font><font style="DISPLAY: inline; COLOR: #000000">. No one was hurt, but large
portions</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">of the plant experienced total
destruction. We believe we have more than adequate insurance protection for the
full amount</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">of all damage. Limited production has
resumed. Damaged operations have been absorbed by other </font><font style="DISPLAY: inline; COLOR: #000000">Smithfield</font><font style="DISPLAY: inline; COLOR: #000000"> plants, at</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">somewhat higher cost but with no
significant disruption to customer service.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">In closing, we have made major strides
to strengthen the balance sheet and reduce financial risk and will continue to
do so in</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the future. We are focused on ROIC,
return on invested capital, and the pork restructuring plan is proceeding well
and the results</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">are beginning to hit the bottom line.
Our packaged meats business is hitting on all cylinders and we are reshaping our
business</font></font></div><br>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">model, better focused on capturing the
strategic advantage of integration with less exposure to commodity elements
and</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">swine production. Our international
business is producing positive results and gaining momentum. We are excited
about the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">future in all aspects of our business.
We are well positioned when the hog market turns and pork restructuring cost
savings will</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">pay even more dividends when the
recession subsides and demand builds.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I thank you very much for your attention
and I will now turn it back to Larry. Thank you.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Thank you, Bo. I think you can tell that
was a very complete report. We've got an awful lot to say this morning, as we
have in</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">most of the past quarters. This
management team is extremely, extremely busy and extremely challenged. I look to
the future</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">by glancing back at the past for a
minute and telling you that I feel like the world has been against us for 12
months, and this</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">thing, it may very well be turning. I
look and say record high corn prices we've had in the last year, an oversupply
of live hogs</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">and historically low live hog prices
combined with that. A 75-year recession hits us in the fall. The financial
crisis, which hit many,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">many companies, and we had a reactive
export market that's driven by political maneuvers more so than really science,
and</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Smithfield</font><font style="DISPLAY: inline; COLOR: #000000"> got its own flu, with the Swine Flu or
the H1N1, and it was named and called </font><font style="DISPLAY: inline; COLOR: #000000">Smithfield</font><font style="DISPLAY: inline; COLOR: #000000"> at Ground Zero. We have
a</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">devastating fire. And then finally we
have the government working against us trying to create incentives for more
ethanol to</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">raise corn prices. And beyond that, the
currency markets impacted us on the export side.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I want to comment at some point and say,
God, do you got anything left? This Company has taken on about every
single</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">challenge that could possibly occur in
one year and yet I believe this management team has been fully on their game and
fully</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">responding to every time an event has
occurred to us.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">We are positioned well. We do see that
sow liquidation looks to maybe -- I'm not going to go out there today and say
it's</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">happening, it will be a couple weeks --
sow liquidation looks positive. The USDA just announced a purchase of $30
million worth</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">of pork products. That will help a
little bit. Our live production costs are going down. And I look out there at
the raising and the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">whole hog production business and I did
some simple math for me. If there's 6 million sows out there, and I don't know
what</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">this industry has invested in live
production, but let's say it's $2,000 or $3000 a sow, that's $10 billion to $20
billion invested in</font></font></div><br>
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        </div><br>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">this whole industry. The whole
enterprise value of the whole industry. They have lost 25% of the whole
enterprise value of the </font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">industry in the last 18 months, and if
we're going to lose somewhere between $25 million and $50 million a week in this
industry,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">there is no chance in the world this can
continue. I am absolutely positive that the industry will run out of money.
That's the one</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">&#160;thing, is just when the banks make
the decision that something's got to change. And I do think we've reached the
inflection</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">point. Something has to
happen.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I made the joke when I first got the job
as the President of this Company in 2001 and we had a tremendous November
and</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">December and I remember reporting to the
board in January, this trend will not continue. Given where we got the losses
on</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the live production side of the
business, I think I can report to you this morning this trend will not continue.
It cannot continue,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">or we will only find a pig in a zoo.
There simply won't be any on any farms.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Our restructuring is going extremely
well. We've got minimal benefits to this point. At some point, that's going to
start hitting</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">in a big, big way. We aren't expecting
but so much this second quarter, but starting into the third quarter, we're
expecting very</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">sizable benefits from
that.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">These export markets will change, and
</font><font style="DISPLAY: inline; COLOR: #000000">China</font><font style="DISPLAY: inline; COLOR: #000000">, which has been the source of offal
shipments forever, will open back up at some</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">point to offal going back into that
country, and mainland </font><font style="DISPLAY: inline; COLOR: #000000">China</font><font style="DISPLAY: inline; COLOR: #000000"> will open back up to normal shipping.
That will happen. And I</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">think about in terms of what the
management team has done some two to three years ago, well before this financial
situation,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the recession hit. We started focusing
on packaged meats. I'm showing you the numbers this morning, for the first time
we've</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">ever been able to show you what packaged
meats is really doing. A year and a half ago, as Bo pointed out, we started
cutting</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">back capital expenditures well before we
had any financial situation in this country. We started cutting back 18 months
ago.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">We started reducing our herds 18 months
ago. We made the management changes and the reorganization 16 months ago.
We</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">went to the capital markets 14 months
ago. All of this happened before anything happened in the financial markets last
fall.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Since then, we have merged our European
operations. We've announced a restructuring of our pork group. We've done
$2</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">billion worth of refinancing to further
strengthen the balance sheet. And we've further reduced our sow herds and
strengthened</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">our whole management approach to this
business. I am extremely pleased with what this management team has done.
This</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">team has been working tirelessly now for
a very long time, yet I think that they have been hitting on all cylinders and
executing</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">absolutely almost perfectly as these
things have occurred. As I said, we had a Swine Flu that we reacted to
immediately. We</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">had a devastating fire we reacted to
immediately, with no loss of shipments to our customers.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">From my standpoint, I've actually never
been more optimistic about the business. We got one thing that's impacting
this</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">business. That's live hog production.
Unfortunately, we have a government policy out there relative to ethanol that is
attempting</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">to increase the blending rates from 10%
to 15% on what I believe is a failed policy and the economics associated with
ethanol</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">simply don't make any sense. For
goodness sake, you don't burn the floors in your house for heat in the
wintertime. Yes, your</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">floors will work well to heat your house
but it's not an economical way to heat your home for very long. Converting corn
into</font></font></div><br>
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          </div>
        </div><br>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">gasoline is not good economics. I'm in
favor of alternative energy policy and pursuit of that, but not every idea is a
good idea.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">And this is one I just simply cannot
support and people are forgetting the impact it's having on another whole big
piece of this economy.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">From a bottom line standpoint, this
Company is managing what it can manage and I think the future is extremely
bright. Once</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">live production returns to more normal
profitability levels, we are absolutely poised to benefit from that in a huge
way and I</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">think the fact that just this quarter we
almost made as much money in packaged meats as we lost in the hog production
side</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">of the business excluding the write-off
of the </font><font style="DISPLAY: inline; COLOR: #000000">Texas</font><font style="DISPLAY: inline; COLOR: #000000"> farms, we made almost as much in
packaged meats as we lost on the farms.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">That's a statement about what happens
when this business turns around. I am bullish to be bullish and I'm pleased with
where</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">we are, in spite of the results we're
reporting this morning.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">With that being said, Keira, we're ready
for questions.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Keira
Ullrich </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Smithfield Foods,
Inc. - Director IR</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Operator, please open the line for
questions.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 12.55pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Operator</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">(Operator Instructions) Your first
question comes from the line of Ken Goldman from JPMorgan. Please go
ahead.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Ken
Goldman </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- JPMorgan Chase
&amp; Co. &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Good morning. Question is on potential
equity offering. I know that you guys have kept it as part of your arsenal. Can
you give</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">us some color on how likely a secondary
is at this point? I know you are eager, and I understand why, to get your debt
to capital</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">ratio down. But it seems to me that if
you think the business is going so well and it seems, except for a huge chunk of
it, going</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">well, that you would probably think the
stock would be worth more six months or a year from now. Why would you do an
equity</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">offering now as opposed to a year from
now?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Ken, you didn't surprise us with that
question, I'll say that. Bo and I commented before this call, let's see if that
will be the first</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">question or the second. It was the
first. So you didn't surprise us with that. At this point, we would tell you
that we've done a</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">good job of strengthening this balance
sheet, and Bo highlighted all of those things. Yet, we continue to look at the
balance</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">sheet and making sure that we have a
strong balance sheet. I don't think that we feel like we have any severe
pressure that we</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">have to do anything and we have no
covenants that force us to do anything.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">On the reverse side of that, we
certainly want to make sure we have all of the financial resources we need to
execute this plan</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">that is certainly starting to hit on
full cylinders. So I can't really comment on that. You know I couldn't do that.
That would be</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">wrong one way or the other. But I will
tell you we keep our eyes focused on the capital markets, just like everyone
else does,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">and we've accessed it when we thought it
made sense, and yet we don't feel any pressure that we have to do
anything.</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Ken
Goldman </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- JPMorgan Chase
&amp; Co. &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">One quick follow-up on interest expense,
$270 million to $275 million is guidance, is that for gross or net interest
expense?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">That's for gross.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Ken
Goldman </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- JPMorgan Chase
&amp; Co. &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Okay, thank you.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I wish there was much net, what you get
paid on money&#8212;</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">We don't get a
rebate.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Gross and net are not very far
apart.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Operator</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Your next question comes from the line
of Christine McCracken from Cleveland Research. Please go
ahead.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Christine
McCracken </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">Cleveland</font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic"> Research &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Good morning. Just wanted to follow up.
You had commented that you're reducing your exposure to production and
you've</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">clearly taken quite a bit out at this
point. Are you seeing moves by others to take out a similar amount of
production, or do you</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">expect to take additional cuts to your
own breeding herd?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Christine, clearly, </font><font style="DISPLAY: inline; COLOR: #000000">Smithfield</font><font style="DISPLAY: inline; COLOR: #000000"> cannot solve this problem alone, unless
we were to take everything out. We can't solve the problem.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">But the answer to that is yes, I have
had conversations with several sizable, more than sizable producers, large
producers, in</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">fact very large producers, and I would
tell you they are doing some liquidation. But again, I don't think they can
solve it. I think</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">this industry has got to solve it
collectively. I do believe everyone is now looking, and when I'm talking to
people who are</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">financially extremely strong and they
are cutting back, that's got to be a statement about those people who are not
financially</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">strong. But the answer is, yes, there
are others cutting back. We're not the only one.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Christine
McCracken </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">Cleveland</font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic"> Research &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Are you seeing an exchange of assets
more than actual production coming out? That's a concern with a few of these
guys that</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">do have quite a bit of financial backing
actually coming in, maybe other packers to secure supply. Does that slow down
the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">liquidation process? What's the risk of
that?</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Christine, I don't think I know of a
single exchange. Maybe I'm just slow this morning, but I don't know of a single
exchange or</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">a single sale that has really gone on to
any degree at all. I don't know of anybody doing any of that. I think they are
genuinely</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">taking out sows and closing farms down
or reducing the density inside the farms. Bo, do you have any
comment?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">No, but I think Christine, back probably
three or four months ago, we were aware of a couple of producers that had taken
some</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">sow operations down because of
economics, but also health reasons. And they may come back at some point in the
future if</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the market conditions improve. But the
longer they are out, the less likely they will be to come back. There may be
some that</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">close down, but in our case, when we're
closed, typically it should be a permanent closure.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Christine
McCracken </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">Cleveland</font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic"> Research &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">And just to be clear, will you possibly
not announce further cuts in your herd, or have you made any decisions about
taking</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">additional cuts?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">We have continued to look under the
whole program of focusing on return on invested capital. And as I mentioned in
my</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">discussion, there is a hog farm in
</font><font style="DISPLAY: inline; COLOR: #000000">Missouri</font><font style="DISPLAY: inline; COLOR: #000000">, we call it the Coffey Farm, that we
have looked for other buyers to take that farm out</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">of our portfolio. It does not make
absolute strategic sense for us and we could move out of that ownership
position.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">What I would say to you, Christine, we
may reduce our exposure to hog production. It does not necessarily mean there
will be</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">a reduction in the industry. We have got
a couple of things, as Bo just commented, that we would look at marketing to
somebody</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">else at a price. We are not doing any
fire sales. We have no pressure to have to do this. But we would like to reduce
the exposure.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">However, I remain absolutely committed
to this business. There have been some rumors out there </font><font style="DISPLAY: inline; COLOR: #000000">Smithfield</font><font style="DISPLAY: inline; COLOR: #000000">'s going to spin</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">off the hog production business or get
out of hog raising. That is not true. And in fact, we are selling on an
integrated basis that</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">whole story domestically and
particularly export. But even domestically. And we have no intentions, no
intentions of getting</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">out of the livestock raising business.
In fact, we are going to stay committed to that in a big way. We're just going
to reduce our</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">exposure to it because of the high
volatility.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Christine
McCracken </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">Cleveland</font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic"> Research &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Perfect. Thank you.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Operator</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Your next question comes from the line
of Ken Zaslow from BMO, please go ahead.</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Ken
Zaslow </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- BMO Capital
Markets &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Good morning, everyone. In terms of the
sow liquidation, how much do you think is needed?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I don't know. Ken, there's two things. I
would say now you could need as much as 10% if I thought productivity was going
to</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">stay at these levels. Everybody's having
record productivity and hog weights are up. Disease is down. And the weather is
terrific.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">At some point all that's going to
change. I mean disease is not gone. The weather's not going to be nice forever.
And today we</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">would need that much, but I think you
don't need that much on an ongoing basis. And it's largely because it's tied to
the export</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">markets. The amount of product going out
of this country has grown dramatically from 7% or 8%, isn't that right Bo, to
about</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">20%.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Right. 10% reduction would feel a lot
more &#8211;</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Oh, my gosh, 10% I think we would have
dramatically different life, and I think we could at even much
less.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Ken
Zaslow </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- BMO Capital
Markets &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">If you include gilts, which obviously
you guys have a better understanding than we do just because we don't get the
type of</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">data that you probably understand, how
much liquidation is actually occurring right now? And as a follow-up to that, if
I take</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">it that you guys are about 16% of the
industry and you are cutting 13%, you guys are about 2% of that. So how much is
actually</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">going on in terms of total liquidation
now and how much do you think it's getting to?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Ken, I think there is another element
that you really can't see in terms of liquidation equation and that's the rate
of replacement</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">gilts So for us to look at merely sow
slaughter doesn't tell you the whole story. I think you're going to have to wait
until the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">September pig report comes out at the
end of this month to truly understand what's happening with the sow rate. I
can</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">optimistically say we've had two weeks
of back to back increased slaughter over a year ago. We've gone from 3% higher
to 4%</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">higher. 2 points make a trend and that
looks to me as though it's close a third higher, or 50% higher than it was the
week before,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">so that's good.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">The other piece of that is that we
continue to have the reduced numbers coming in from </font><font style="DISPLAY: inline; COLOR: #000000">Canada</font><font style="DISPLAY: inline; COLOR: #000000">, so that is certainly
taking</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">meat off the </font><font style="DISPLAY: inline; COLOR: #000000">US</font><font style="DISPLAY: inline; COLOR: #000000"> market. But don't downplay the impact
of this productivity. The people I've talked to in the industry, they
may</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">be reducing their herds, but they are
all commenting they are having tremendous productivity with the animals in terms
of</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">livability. Those numbers are excellent.
A lot of this may very well be, a good portion of this may very well be offset
by weights</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">in productivity right
now.</font></font></div><br>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Ken
Zaslow </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- BMO Capital
Markets &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">And $500 million for the pork business
seems like you're completely and utterly on target for that? No reason to change
that,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">is that fair?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I'm not sure I understood the question,
Ken.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Ken
Zaslow </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- BMO Capital
Markets &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I think in past conference calls, I
think you've said the pork business should be able to generate about $500
million of operating</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">profit on an ongoing basis. There's no
reason not to believe that? You guys seem to be hitting the cover off the ball
on that, is</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">that fair?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Yes.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Ken
Zaslow </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- BMO Capital
Markets &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Okay, cool.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Thank you, Bo. One of the things that is
showing here on the earnings is the fresh pork numbers showing a loss for the
quarter.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I mean fresh pork is extremely strong
right now and has been now for 30 days, Bo?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Right.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">And we move into fresh meat season.
We're still extremely bullish on the pork group, extremely
bullish.</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Ken
Zaslow </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- BMO Capital
Markets &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Thank you.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Operator</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Your next question comes from the line
of Akshay Jagdale from KeyBanc. Please go ahead.</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Akshay
Jagdale </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Keybanc Capital
Markets &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Good morning. Couple of questions.
Firstly, on the hog production side, when we look at sow slaughter, I know it's
one part of</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the equation. But historical average on
a weekly basis is about 66,000. So if you look at the numbers last two weeks,
they have</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">been about 70,000 or so, which would
mean that even if we continue at this rate, at the 70,000 clip for the next
year, you take</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">out about 200,000 sows. To me, it seems
slower than what you would expect. So what is it that we're missing? You keep
saying</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">that you've had conversations with other
large producers, et cetera, who seem to be cutting their herd. And obviously all
of us</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">can see the numbers for hog production,
but what is it going to take? The government program which they are going to
buy</font></font></div><br>
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        </div><br>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">30 million now. Can you talk a little
bit about just the situation about sow slaughter and the capacity of sow
slaughter as it</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">relates to the demand for sausage, et
cetera, that may play into this whole equation? Can you just talk to
that?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I think that when you ask, is there a
missing element that is making the analysis somewhat more difficult, and as I've
mentioned</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">before, you've got a sow replacement
rate, a gilt replacement rate, that probably, under normal conditions, is
somewhere</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">between 40% and 45% of the entire herd
gets turned over every year as replacement animals. If they cut that by as
little as 20%</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">you could have almost a 5% to 10% change
in the sow herd merely on the basis of replacement. You can affect it probably
faster</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">by impacting replacement rate than you
can by slaughter rate of the industry. So I think that it is a very important
element.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">You really won't see that until the
September hog report and we do know that those issues have been going on. If you
can get</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">information out of some of the breeding
stock companies, I think they will tell you their sales for replacement animals
have</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">been very, very slow and anemic, which
is a good sign. That means that we're not replacing at a very high rate and it
could be</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">that all of the change in sow numbers is
coming through replacement rate changes.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">As far as slaughter capacity is
concerned, we probably have the ability to kill another, I would say, 7,000 to
8,000 head of pigs</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">on a weekly basis as far as sows are
concerned, above what we're doing today. We could probably approach 80,000 sows
per</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">week.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Akshay
Jagdale </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Keybanc Capital
Markets &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Okay, that's helpful. On the pork side,
it's very helpful that you are breaking out these numbers. Can you tell me what
your profit</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">per pound was on the packaged meat side
or overall this quarter?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Close to $0.16 per
pound.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Akshay
Jagdale </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Keybanc Capital
Markets &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Is that seasonal? Because I know in your
past presentations you've talked about getting as high as $0.12 a pound on some
items,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">but $0.16 for the quarter, is it
seasonal? Can you talk about what the normalized range is? Does that need to be
up now given</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">what you're seeing in terms of
restructuring in that group, et cetera? Because you had said fresh spreads are
around $0.02 to</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">$0.03 and the packaged side is anywhere
from $0.04 to $0.12, right? So if you had $0.16 cents overall on the pound, how
should</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">we think of that on a normalized
basis?</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I think one of the things that we have
been preaching now for a couple of years is the fact that we would achieve a
$0.10 return</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">on 3 billion pounds, or $300 million.
$0.16 -- it doesn't take a rocket scientist to realize that's above $0.10. We
are benefiting</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">from low hog prices and cheap raw
material. I do believe the $0.10 is very achievable and I think the $0.12 or
$0.13 cents -- and</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">maybe more than that. That's hard to see
at this point, but I think you can count on the $0.10 cents, as long as raw
material</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">stays cheap. It's part of the offset to
the live production side and the fresh meat. It's an offset. It will likely come
down.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">But you should not think this is a
particularly seasonal impact that's occurring now. In fact, we're going into a
pretty good season.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">The second and third quarter are really
the good seasons for the packaged meats business, not the first. We haven't
really hit</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the good season yet. We are preparing to
adjust our sights higher for that, given how successful this restructuring is
going and</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">our ability to manage this end of the
business. I've continued to say it quarter after quarter after quarter. Everyone
wants to talk</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">about live hog prices and sow
liquidation, and I've continued to say can I have my two minutes to talk about
the packaged</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">meats business, while we're returning 9%
of sales, guys, and no one seems to ever pay attention to that. They only want
to</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">know what do you think the green market
is going to do in the future? You never ask me what the bacon business is going
to</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">do in the future. I think you should be
careful using $0.16. You should be careful with a number that high. That is
really very</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">good. I think our $0.10 or more is where
we're planning the future to be.</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Akshay
Jagdale </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Keybanc Capital
Markets &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">And one last one on the hog production
side, you gave some numbers on your commentary about hedging, where I think
you</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">said $11 million in hedging gains on the
hog side. That translates into about $0.01 a pound roughly. But the difference
between</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">your raising costs that you report and
the hog price is a lot different than what you get from your EBIT when you
divide it by</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the number of pounds you process. I
still see that there's a $0.05 per pound difference in that number, which I
attribute to</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">hedging, but you said your hedging gain
on the revenue side was only $0.01 a pound. So is your international
production</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">business that profitable? Is it earning
$30 million plus? I'm just trying to get a sense of this because it's very
important in modeling</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the business because we do model the
business based on spreads, but then there's this other component, which is
pretty sizable </font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">and has been in the $200 million, $250
million range for the last two years. So can you help us understand that piece?
It's hedging</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">and the international operation. So can
you just help us understand that a bit better?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I think frankly I would like to ask you
to call me offline because I'm somewhat confused by exactly what it was that you
asked</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">and I would be happy to address that,
but I'm not sure that was -- there were a number of questions in there. So
please, call me</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">and I'll be happy to answer
it.</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Bo, I don't think there was any comment
that you made about an $11 million hedging gain on live
production.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">No.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">In this quarter. If you said that, I
must have been sleeping.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">We did have positive results in hog
hedges that were offset dramatically by our corn position. But I didn't quote
any number</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">in there. You can't necessarily just
take the delta between the two because we've got hedging in soybean meal, we've
got</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">hedging in interest rates, we've got
hedging in our utility commodities.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Akshay
Jagdale </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Keybanc Capital
Markets &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Okay, thank you.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Operator</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Your next question comes from the line
of Christina McGlone from Deutsche Bank. Please go ahead.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Christina
McGlone </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Deutsche Bank &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Thank you, good morning. My question is,
on the packaged meats side how much restructuring benefits are flowing
through?</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Because the press release talked about
it and I think Bo talked about it, but Larry you had said there's not really a
lot flowing</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">through yet. Can you quantify the cost
of the fire and the business interruption related to that?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I'll address the fire issue. We have a
small deductible, I think about $1 million, which was taken into this quarter,
this quarter's</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">P&amp;L, a de minimus amount. But we
have full coverage and we've been working very closely with the insurance
adjusters and</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">we're very confident we'll have full
coverage. So I don't think you'll see any potential negative impact from that
fire as far as the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">&#160;P&amp;L is concerned. We've got a
lot of work to do to even finally determine what the total impact of the fire
was, but we believe</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">we've got full
coverage.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">In terms of the restructuring, I would
tell you that we anticipated having a $5 million negative impact on the
quarter's P&amp;L when</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">in fact we had what we estimate is an $8
million positive to the P&amp;L. So from our standpoint, that's how much better
this is</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">going than we thought it would be. We're
ahead of schedule on the savings side. We're actually ahead of schedule on
savings</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">and we underspent on the cost side. So
both of those went our direction this quarter. Part of that was driven by a
decision to</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">close one of the six plants ahead of
schedule in order to deal with a pension issue.</font></font></div>
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        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
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          <div id="HDR">
            <div id="GLHDR" style="WIDTH: 100%" align="right"><font style="DISPLAY: inline; FONT-SIZE: 8pt; COLOR: #000000; FONT-FAMILY: Times New Roman">&#160;
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        </div><br>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Christina
McGlone </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Deutsche Bank &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Okay, and just the fire, I was just
wondering what expenditures you made in the quarter, because I'm trying to think
about</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">getting a pure run rate
number.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Let me answer that quickly. We don't
have that number. It is an extremely complicated process of determining what the
impact</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">out of one plant to another plant and
relocation and transportation. There's no way we would ever get our auditors to
agree</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">to some number related to that. All I
could tell you is it was significant and it has impacted us, but we just dealt
with it.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Christina
McGlone </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Deutsche Bank &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Okay, and then my follow-up. Larry
talked about </font><font style="DISPLAY: inline; COLOR: #000000">China</font><font style="DISPLAY: inline; COLOR: #000000">. I guess there's a pending decision by
the Administration with respect</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">to China-made tires and that they may
retaliate with pork. How should we think about that? What's the risk associated
there?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">They can't retaliate any more than 100%.
We've been blocked out of the Chinese market, all North American pork, US,
</font><font style="DISPLAY: inline; COLOR: #000000">Canada</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">and </font><font style="DISPLAY: inline; COLOR: #000000">Mexico</font><font style="DISPLAY: inline; COLOR: #000000">, since the last week of April
associated with the H1N1 flu. So frankly, they can't do any more damage than
they have</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">done already.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Christina
McGlone </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Deutsche Bank &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Okay, thank you.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Operator</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Your next question comes from the line
of Reza Vahabzadeh from Barclays Capital. Please proceed.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Reza
Vahabzadeh </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Barclays Capital &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Good morning, Reza Vahabzadeh from
Barclays. Just a question on packaged meat EBIT improvement, which was
pretty</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">significant. Larry or Bo, how much of
that improvement in ballpark terms would you attribute to the lower raw
materials costs?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Impossible to tell. That is a very
difficult question. You could attribute some element of cents per pound, but
really this quarter</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">we're now in will probably reflect even
lower costs of raw materials, but it will also reflect correspondingly some of
the best</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">ham markets and other packaged meat
sales we'll have. So difficult to give you a specific number. It's just not that
easy to</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">calculate.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">The only thing we're saying is that we
had $0.15, $0.16 for the quarter. That is a big number. But it doesn't have the
restructuring</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">in it. Had we been fully on
restructured, it would have been significantly higher than that. But don't count
on our packaged</font></font></div><br>
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        </div><br>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">meats business delivering $0.16 or $0.17
cents a quarter. Don't count on that. That number, I hope we can do it, but that
number</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">is a big number.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Reza
Vahabzadeh </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Barclays Capital &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Right. Larry, you're still guiding to a
$0.10 or better number as a normalized EBIT, and this quarter, you did $0.16,
maybe even</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">$0.17. Is it fair to assume that some of
that $0.06 or $0.07 was due to unusually low raw material
costs?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">You can make that analogy if you want. I
don't think it's that much, but I do think the $0.10 cents, we have reached my
goal</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">with the $0.10 and I would tell you we
have surpassed my goal.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">And the $0.10, if I may underscore, was
really before the restructuring program was even instituted, and we've said that
on a</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">conservative basis we think that was
$0.02 cents alone, or a 20% improvement in packaged meats profits just from that
process</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">and we think we're going to blow right
through that number, as well.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Reza
Vahabzadeh </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Barclays Capital &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">And then one housekeeping item. What was
the total debt number at quarter end if you marked the convertible at face
value</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">of $400 million.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Can we get back to you on that? That's
not just absolutely a straightforward equation, but we can get you that
number.</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Reza
Vahabzadeh </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Barclays Capital &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Okay, thank you.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Operator</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Your next question comes from the line
of Robert Moskow from Credit Suisse. Please go ahead.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Will
Sawyer </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Credit Suisse &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Good morning. This is Will Sawyer for
Rob. My question is on fresh pork. In August, margins were very good. Do you
think even</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">though we're entering a seasonally good
period, that an increase in slaughter rates could cause margins to go back into
the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">red?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">No, I don't think margins on fresh pork
are going to go into the red in the fall portion of the year. I don't believe
that. Unless,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the only thing I think that would do
that -- was your name Phil?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Will
Sawyer </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Credit Suisse &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Will.</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Will, the only thing I think that could
conceivably do something like that is to have some strange change in live hog
prices where</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">they would shoot up dramatically where
it wouldn't transfer through into pricing. But no, I don't see fresh pork going
in the</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">red.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Will
Sawyer </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Credit Suisse &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Then on the tax rate, just to make sure
I'm clear, is the 34% to 36%, is that for the year or
ongoing?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Full year.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Will
Sawyer </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">- Credit Suisse &#8211;
Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Full year, okay. Thank
you.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Operator</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Your next question comes from the line
of Farha Aslam from Stephens Inc.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Farha
Aslam </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Stephens Inc. &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Hi, good morning.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Looks like you got quoted in the paper
this morning. You're in the paper this morning for </font><font style="DISPLAY: inline; COLOR: #000000">Smithfield</font><font style="DISPLAY: inline; COLOR: #000000">.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Farha
Aslam </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Stephens Inc. &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I'll have to check that out. My question
is, do you think that banks are getting tougher with the hog farmers and forcing
liquidation</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">or do you think it's just capitulation
on the part of the industry? And going forward, are you at all concerned about
the supply</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">of hogs? And when do you think there's a
concern about a shortage of supply?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I can't wait for that concern about
shortage of supply. I dream about that. In terms of the banks, you probably
could maybe</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">even get better anecdotal information
out of banks than we could. They are going to be very guarded about telling us
any</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">information. And so frankly, we're at a
point now where we've heard the liquidation story from the banks
for</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">so long that until I see it showing up
in the slaughter numbers, I discount it somewhat. But I do think they are
putting a lot of pressure </font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">on these </font></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">guys because they are coming to the end
of their equity. So just the tone and the conversation of both producers and
bankers</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">has changed dramatically in the past 30
to 90 days. Once pigs got below $0.40, I think it gave those folks a cold towel
in their</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">face, time to wake up, that this thing
isn't going to change until somebody does something different. There's a saying
that says</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">that the market stupidity is doing the
same thing over and over again and expecting a different outcome and I think
that that</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">has been true for some of the livestock
producers in the past, that they have got to change if they want to return to
profitability.</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Farha
Aslam </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Stephens Inc. &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">And are you supporting the producers
that you buy from, or do you feel like you'll have adequate
access?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">When you say support, we're buying hogs
from them, every day according to every contractual relationship we have, so
that</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">hasn't changed at all. And certainly if
they said they were having issues financially, we would be very, very
compassionate</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">towards them, but we haven't stepped in
to support any of the producers on a financial basis at this point. And that's
the key</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">to our integration model, is that we've
got pigs, we're making sure we have the right pig in the right place at the
right plant to</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">execute our marketing strategy, and
that's key to the integration going forward.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">The only producer we're supporting at
this point is </font><font style="DISPLAY: inline; COLOR: #000000">Smithfield</font><font style="DISPLAY: inline; COLOR: #000000"> at this point.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Farha
Aslam </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Stephens Inc. &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">And my final question is looking out
over the next six months into the fall period, what do you see in terms of
retail demand</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">and food service
demand?</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Bo
Manly </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. &#8211; CFO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">In terms of food service demand, I think
that's going to be about steady with what it has been. There has been a decrease
overall,</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">in particularly white tablecloth, but at
the same time, an expansion of the QSR sales. And actually that really feeds to
our strong</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">point in terms of our packaged meats
positioning and our food service sales. So that is good for us. At this point, I
don't know</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">that we or anybody else is totally
capable of predicting what's going to be the impact of the government stimulus
plan on pork</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">demand, as we move forward. Certainly I
think that we've hopefully reached the bottom in terms of that process and that
we</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">can look at a better economic outlook
going forward.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Farha
Aslam </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Stephens Inc. &#8211; Analyst</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Okay.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Operator</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I will turn it back to you, Mr. Pope,
for any closing remarks.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; COLOR: #000000; FONT-FAMILY: Times New Roman">Larry
Pope </font><font style="DISPLAY: inline; COLOR: #000000; FONT-STYLE: italic">-
Smithfield Foods, Inc. - President and CEO</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">To summarize, the futures markets
certainly don't look all that good for live production for now. Several more
months and</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">quarters into the future here. So I
think the live production side of the business is going to continue to be
challenged, at least</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">on the sales side. We will see
continuing decline in our raising costs and we expect once this hedge runs out,
they will decline.</font></font></div><br>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I think you all know there's $3, or
close to $3 corn out there and that looks to benefit us. So I think, as I said,
the live production</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">side of the business can't stay where
it's at and fundamentally, it's moving our direction, even if we don't have
liquidation.</font></font></div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt"><br></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">I want to finally say that this
management team, under the direction of George Richter on the pork processing
side, as well as</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">our international presidents and our
live production people have been done an excellent job at managing through this
business</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">through these critical times. I hope
you'll focus where we're beginning to break the numbers out. The meat side of
the business</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">is doing excellent and is going to
continue to deliver some very good numbers and I'm hopeful over time we can
convince you</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">this is an important profit driver of
this Company and will continue to be a better and better piece of this business.
We believe</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">the best days for </font><font style="DISPLAY: inline; COLOR: #000000">Smithfield</font><font style="DISPLAY: inline; COLOR: #000000"> are in front of us. All we've got is
one issue. Live production needs to return to profitability,
which</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">it will. Thank you very
much.</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Operator</font></font></div>
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        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">Ladies and gentlemen, this conference
will be available for replay after 11:00 a.m. today through September 22 at
midnight.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">You may access AT&amp;T teleconference
replay system at any time by dialing 1-800-475-6701, entering the access code of
112846.</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">International participants, please dial
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access</font></font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 10.25pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">code of 112846. That does conclude our
conference for today. Thank you for your participation and for using AT&amp;T
executive</font></font></div>
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