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SUSTAINABILITY REPORT

Given today’s global economy with growing and emerging markets, as well as an increasing demand for safe, high-quality food products, expanding business outside of the U.S. has become a key strategic priority for Tyson Foods. We produce and brand international products for local customers and consumers around the world. In fiscal year 2012, we exported protein products to more than 130 countries. Our major sales markets include Brazil, Canada, Central America, China, the European Union, Japan, Mexico, the Middle East, Russia, South Korea, Taiwan, and Vietnam.

Tyson Foods also maintains in-country poultry operations in Mexico, China, India, and Brazil. As one of the world’s largest processors and marketers of chicken, beef, and pork food products, we have brought the best practices from our U.S. operations to our international operations and believe we are well-positioned to manage our in-country international operations with actions and programs that:

  • Provide safe, quality food products to our customers and consumers.
  • Create business and industry value.
  • Benefit our Team Members and local communities.
  • Build collaborative partnerships focused on responsible and sustainable business.

Below, we provide examples of how we are fulfilling these commitments at our in-country poultry operations.

Chinese Tyson® Product Chinese Tyson® Product Ensuring Food Safety in Emerging Markets
Tyson Foods has had a presence in China since 2001 and currently has three poultry operations in the country.

  • Tyson DaLong is a small joint venture for further processing of chicken that was established in 2001. This facility houses two further-processing lines and has par-fry capabilities. It supplies quick-service restaurants and wholesale and retail customers. Tyson Foods is majority owner of this operation, which employs 300 people.
  • In 2009, Tyson Foods entered another joint venture in the Shandong province. Tyson Shandong is a partially integrated chicken operation. The Tyson Shandong operation consists of three slaughter facilities with the capacity to process a planned three-million chickens per week by 2014. Tyson Shandong employs more than 7,000 Team Members and serves quick-service restaurants and retail outlets. In August 2011, Tyson Foods assumed full ownership of this business.
  • To grow its quick-service restaurant, retail, and distribution business in the Shanghai market, Tyson Foods established an operation in the Jiangsu province in 2008. Tyson Nantong, which is fully owned by Tyson Foods, is a vertically integrated poultry operation with company-controlled housing for 100 percent of its chicken supply and a new western-style chicken processing plant that implements the highest food safety and quality assurance standards. This operation currently employs more than 600 Team Members.

China remains one of Tyson Foods’ targets for continued international growth. With a population of 1.3 billion and chain restaurants opening at a rate of one every 18 hours, the Chinese market needs more poultry production. Chinese poultry production is projected to grow and outpace overall production. Yet the demand for high quality, residue-free chicken is significantly outpacing availability.

Tyson Foods is investing in, and developing, a fully integrated poultry business in China, with 100 percent of their chicken supply coming from company-controlled farms. These farms will:

  • Be highly efficient and employ maximum bio-security measures.
  • Provide a healthy living environment for the chickens.
  • Produce chickens that are free of chemical residues to assure a secure, safe, traceable food supply for Chinese consumers.

We are also upgrading our processing facilities to assure high production efficiencies and a competitive cost structure. Tyson Foods will continue to develop a premium, branded product portfolio in China that provides the quality chicken products our customers and consumers deserve.

A Change in Poultry Farming and Consumption
In 2008, Tyson Foods acquired majority ownership of one of India’s leading branded chicken companies. In addition to serving the foodservice market, Godrej Tyson Foods produces retail fresh chicken under the Real Good chicken brand and further processed chicken under the Yummiez® brand. The combined production of the two plants in Mumbai and Bangalore, which are both state-of-the-art, Hazard Analysis Critical Control Point (HACCP) certified processing plants, is currently 280,000 chickens per week with expansion plans underway at both plants.

India has a population of more than one billion, and many people there are vegetarian. Per-capita chicken consumption is less than five pounds per year; however, it’s growing at a rate of 10 percent a year, which is among the highest in the world. The country’s poultry industry is fragmented and relatively unorganized, with more than 90-percent of the chickens being sold live in various markets.

Due to rapid urbanization in India, there’s an increasing demand for safe processed chicken as consumption shifts from a grain-based diet to poultry, meat, fish, fresh fruits, and vegetables. Accordingly, India’s organized, processed chicken segment is growing rapidly. There has been an increase in automation, and the country’s mechanized processing capacity has been increasing steadily.

We are focused on serving the growing demand for quality poultry in India. Godrej Tyson Foods is the first company to market fresh, chilled chicken in India, and we are evaluating opportunities to expand in northern and eastern regions of the country to meet the growth and demand of our foodservice and retail customers. We’re also exploring the possibility of live operations and expanding value- added production to other areas of India to reduce logistical costs and improve product availability. Godrej Tyson Foods is committed to offering consumers safe, wholesome products.

Team Members from Tyson de Mexico Supporting Our Team Members and Local Communities
Tyson Foods has had a presence in Mexico for 20 years. Tyson de Mexico is a vertically integrated poultry producer and marketer employing approximately 5,400 Team Members. Tyson de Mexico:

  • Currently holds the No. 3 market-share position in Mexico and is the country’s largest producer and distributor of value-added poultry products.
  • Is No. 1 in value-added chicken production.
  • Processes approximately 2.7-million chickens per week.
  • Is at full capacity in its three processing plants in a market that continues to grow.

Mexico is a relatively established market that shares many of the same “best practices” used in the U.S. Tyson de Mexico markets products under the Tyson® brand, the Del Dia® brand, and the Granja San Martin® brand. Tyson de Mexico also exports to Vietnam and Guatemala and is just steps away from achieving its first exports to the U.S. and Africa.

In 2011, Tyson de Mexico participated in an event called “Nutrition Day,” with university students from the Tec de Monterrey. The event was organized as a cooking competition, and participants were required to prepare healthy meal options for different at-risk populations in Mexico using chicken breast as the main ingredient. The competition helped the participating university students learn more about chicken’s nutritional value and food preparation. For Tyson de Mexico, the project represented an opportunity for the company to further educate the public and promote healthy lifestyle choices.

Tyson de Mexico continues to support community-based groups and programs that seek to promote healthy lifestyle choices through physical activity, including athletic clubs and organizations like the Santos Laguna Soccer Club and the Vaqueros Laguna and Saraperos de Saltillo baseball teams. Tyson de Mexico’s support and the support of other large companies in the region help these important athletic clubs to continue meeting the community’s needs.

Tyson do Brasil Plant Tyson do Brasil Product Partnering for Responsible and Sustainable Business
In 2008, Tyson Foods created Tyson do Brasil when it acquired three companies in the South of Brazil, two in the state of Santa Catarina, and one in the state of Parana. With a production capacity of 1.7-million chickens per week, and an opportunity to grow to two-million chickens per week, Tyson do Brasil is focused on producing the highest quality chicken products. Tyson do Brasil offers a large variety of chicken products, including frozen, individually quick frozen, fresh, and marinated cuts.

Brazil has a population of 192-million people, a growing economy, and a rising middle class. Along with these factors, inexpensive and available land, abundant grain and livestock, a favorable climate, and low input costs have allowed a very profitable poultry industry to develop. Tyson do Brasil’s goal is to have access to a growing internal market and to export to the European Union, South Africa, Canada, China, Japan, South East Asia, the Middle East, and South America.

Tyson do Brasil maintains a strong commitment to transparency with its Customer Visits Program. During these day-long visits, customers learn about and see the main stages of chicken processing. They also have an opportunity to meet our team and attend lectures on a number of topics, such as product quality and maintaining freshness at the point of sale. Tyson do Brasil also opens its doors to scientists, educators, and students. We maintain collaborative relationships with local universities to stay informed of recent scientific developments and emerging trends. Professors of various areas of specialty related to business and science also bring their students for company visits.

Tyson Foods is firmly positioned to succeed in these and other emerging markets. We want to help develop the poultry industry in each of these markets by leveraging our best-in-class live production and processing operations and our global customer base. We are committed to bringing high-quality and safe food to our global customers and to helping raise the overall standards of poultry farming and processing in a socially responsible and culturally relevant way.

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