SEABOARD CORP DE
For the period ended Jun 29, 2024. Filed Jul 30, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 29, 2024 · Filed Jul 30, 2024
SEB$3,528.16+3.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-30; filed 2024-04-30.
0000088121-24-000060
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-29; filed 2024-07-30.
0000088121-24-000074
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 42 previous paragraphs and 45 current paragraphs.
15 unchanged; 18 reworded; 11 added; 6 removed; 3 previous and 1 current paragraphs rearranged.
Tables are not compared: 7 previous and 7 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (11)
Current report
Other Investment Income, Net
Current report
Other investment income, net decreased $18 million and $27 million for the three- and six-month periods of 2024, respectively, compared to the same periods in 2023, primarily due to unrealized mark-to-market losses on short-term investments.
Current report
Foreign Currency Gains (Losses), Net
Current report
Foreign currency gains, net decreased $18 million and $15 million for the three- and six-month periods of 2024, respectively, compared to the same periods in 2023, primarily due to fluctuations in the South African rand.
Current report
The increase in sales for the three- and six-month periods was primarily a result of higher prices due to commodity markets and higher volumes of pork products and market hogs sold due to more production. Higher prices contributed sales of $51 million and $66 million, and higher volumes contributed sales of $27 million and $63 million for the three- and six-month periods, respectively. This segment also produces renewable natural gas, but sales are currently not significant as production is dependent upon maturity of the lagoons.
Current report
Liquid Fuels Segment
Current report
The decrease in sales for the three- and six-month periods was due to lower fuel and environmental credit sales. Lower volumes of fuel sold decreased sales $19 million and $72 million for the three- and six-month periods, respectively, as the renewable diesel plant was not operational for approximately four months during the first half of 2024 due to maintenance and repairs and less biodiesel was sold due to the timing of sales. Management expects consistent production at the renewable diesel plant throughout the remainder of 2024. Lower market values of environmental credits decreased sales $12 million and $53 million for three- and six-month periods, respectively.
Current report
Operating income decreased for the three- and six-month periods primarily due to a decrease in margins of $27 million and $44 million, respectively. Margins decreased for the three- and six-month periods due to lower volumes produced and sold and higher maintenance and repair costs incurred at the renewable diesel plant, partially offset by a decrease in variable production costs, with a larger impact for the six-month period due to maintenance performed. Management is unable to predict market prices for biodiesel, renewable diesel, environmental credits, or the cost of feedstocks for future periods; however, based on current market conditions with lower renewable diesel and biodiesel prices and higher animal fat feedstock costs, management is uncertain whether this segment will be profitable for the remainder of 2024. Commodity markets are volatile, and management believes that current industry economic conditions are temporary.
Current report
CT&M’s investments in affiliates are represented by numerous milling, feed and protein affiliates, with no individual investment representing a material fluctuation. The increase in income from affiliates for the three- and six-month periods was primarily due to higher margins with lower commodity costs.
Current report
The decrease in sales for the three- and six-month periods was due to an overall decline in average freight rates due to competitive pressures. The decrease was partially offset by an increase in cargo volumes, which increased 10% and 3% for the three- and six-month periods of 2024, respectively, compared to the same periods in 2023.
Current report
The decrease in sales primarily reflected less power generation, impacting sales $4 million and $12 million for the three- and six-month periods, respectively, due to power generation from lower variable-cost producers and maintenance conducted primarily in the first quarter, partially offset by an increase in spot market rates due to higher fuel prices.
Removed paragraphs (6)
Previous report
The decrease in sales was due to lower biodiesel and renewable diesel sales of $86 million primarily driven by a decrease in volumes sold of $103 million, partially offset by an increase in the price and volume of associated credits sold which increased sales $28 million. The renewable diesel plant was not operational during the first quarter of 2024 due to maintenance and repairs. In addition, approximately half of the volume decrease was due to less biodiesel sold due to the timing of sales. The decrease in sales was partially offset by higher volumes and prices of pork products and market hogs sold which increased sales $31 million and $24 million, respectively.
Previous report
The decrease in sales was primarily due to an overall decline in average freight rates as a result of the normalization of demand for ocean transportation services. Cargo volumes decreased 2% for the three-month period of 2024 compared to the three-month period of 2023.
Previous report
Sugar and Alcohol Segment
Previous report
Sugar sales decreased primarily due to lower volumes driven by less market demand. Alcohol sales primarily decreased due to lower governmental price adjustments that were not enough to compensate for the Argentine peso devaluation during the quarter.
Previous report
The decrease in operating income primarily reflected lower margins of $10 million on alcohol sales due to higher production costs driven by inflationary pressure and lower revenue. Management cannot predict local sugar and alcohol prices or the volatility in the currency exchange rate for future periods, and management is uncertain whether this segment will be profitable for the remainder of 2024.
Previous report
The decrease in sales primarily reflected lower dispatch volume of $7 million due to maintenance, partially offset by higher spot market rates.
Reworded paragraphs (18)
Previous wording
Management believes Seaboard’s combination of internally generated cash, liquidity, capital resources and borrowing capabilities will be adequate for its existing operations and any currently known potential plans for expansion of existing operations in both the short-term and long-term.
Current wording
Management believes Seaboard’s combination of internally generated capital resources and borrowing capabilities will be adequate for its existing operations and any currently known potential plans for expansion of existing operations in both the short-term and long-term.
Previous wording
Liquidity includes cash and cash equivalents, short-term investments and available borrowing capacity under line of credit facilities. As of March 30, 2024, Seaboard had cash and short-term investments of nearly $1.2 billion and total net working capital of $896 million. The following table presents a summary of Seaboard’s available borrowing capacity under lines of credit.
Current wording
Liquidity includes cash and cash equivalents, short-term investments and available borrowing capacity under lines of credit facilities. As of June 29, 2024, Seaboard had cash and short-term investments of nearly $1.2 billion and total net working capital of $924 million. The following table presents a summary of Seaboard’s available borrowing capacity under lines of credit.
Previous wording
As of March 30, 2024, $77 million of the $1.2 billion of cash and short-term investments were held by Seaboard’s foreign subsidiaries. Historically, Seaboard has considered substantially all foreign profits as being permanently invested in its foreign operations, including all cash and short-term investments held by foreign subsidiaries. During 2022, Seaboard reversed its indefinite reinvestment assertion in connection with certain previously-taxed undistributed earnings of its Seaboard Marine subsidiary due to the tax effectiveness of repatriating. For all other foreign subsidiaries, Seaboard intends to continue permanently reinvesting their funds outside the U.S. as they continue to demonstrate no need to repatriate them to fund Seaboard’s U.S. operations for the foreseeable future. Seaboard has not recorded deferred taxes for state or foreign withholding taxes that would result upon repatriation of these funds to the U.S. Determination of the tax that might be paid on unremitted earnings if eventually remitted is not practical due to the complexity of the multi-jurisdictional tax environment in which Seaboard operates.
Current wording
As of June 29, 2024, $60 million of the $1.2 billion of cash and short-term investments were held by Seaboard’s foreign subsidiaries. Historically, Seaboard has considered substantially all foreign profits as being permanently invested in its foreign operations, including all cash and short-term investments held by foreign subsidiaries. During 2022, Seaboard reversed its indefinite reinvestment assertion in connection with certain previously-taxed undistributed earnings of its Seaboard Marine subsidiary due to the tax effectiveness of repatriating. For all other foreign subsidiaries, Seaboard intends to continue permanently reinvesting their funds outside the U.S. as they continue to demonstrate no need to repatriate them to fund Seaboard’s U.S. operations for the foreseeable future. As a result, Seaboard has not recorded deferred taxes for state or foreign withholding taxes that would result upon repatriation of these funds to the U.S. Determination of the tax that might be paid on unremitted earnings if eventually remitted is not practical due to the complexity of the multi-jurisdictional tax environment in which Seaboard operates.
Previous wording
Cash provided by operating activities decreased $73 million for the three-month period of 2024 compared to the same period in 2023. Less cash generated from working capital of $130 million and less dividends received from affiliates of $17 million, were offset by an increase in net earnings, adjusted for non-cash items, of $76 million. The working capital changes primarily reflected a decrease in cash flows from receivables due to lower revenue.
Current wording
Cash provided by operating activities decreased $179 million for the six months ended June 29, 2024, compared to the same period in 2023. Less cash generated from working capital of $252 million and less dividends received from affiliates of $25 million were partially offset by an increase in net earnings, adjusted for non-cash items, of $101 million. The working capital changes primarily reflected a decrease in cash flows from receivables due to lower revenue and timing of collections and an increase in cash flows related to payments of other liabilities.
Previous wording
Cash flows from investing activities for short-term investments are part of Seaboard’s overall liquidity management strategy. Short-term investment purchases are a result of the investment of excess cash, asset allocation from the active management of the portfolio and re-investment of matured securities. Proceeds from the sale of short-term investments may be used to fund working capital needs and capital expenditure purchases. During the three months ended March 30, 2024, Seaboard invested $104 million in property, plant and equipment, of which $87 million was in the Pork segment for renewable biogas recovery projects and other investments.
Current wording
Cash flows from investing activities for short-term investments are part of Seaboard’s overall liquidity management strategy. Short-term investment purchases are a result of the investment of excess cash, asset allocation from the active management of the portfolio and re-investment of matured securities. Proceeds from the sale of short-term investments may be used to fund working capital needs and capital expenditure purchases. During the six months ended June 29, 2024, Seaboard invested $237 million in property, plant and equipment, including biogas recovery projects in the Pork segment and installment payments on vessels under construction in the Marine segment and other investments. At certain hog farms, the Pork segment is constructing biogas recovery facilities to capture methane from its hog lagoons and inject it as renewable natural gas into the local pipeline infrastructure. The payments for vessels are made in accordance with milestones achieved throughout construction and two vessels are expected to be completed in 2024. For the remainder of 2024, management has budgeted capital expenditures totaling approximately $320 million. Management anticipates paying for these capital expenditures from a combination of available cash, proceeds from the sale of available short-term investments and Seaboard’s available borrowing capacity.
Previous wording
Cash flows from financing activities primarily include draws and repayments on lines of credit. Seaboard’s lines of credit are used to fund working capital and investments in capital expenditures, as needed. The primary long-term debt outstanding is a Term Loan due in 2033 with a balance of $970 million as of March 30, 2024.
Current wording
Cash flows from financing activities primarily include draws and repayments on lines of credit. Seaboard’s lines of credit are used to fund working capital and investments in capital expenditures, as needed. The primary long-term debt outstanding is a Term Loan due in 2033 with a balance of $968 million as of June 29, 2024.
Previous wording
Seaboard’s operations are heavily commodity-driven and financial performance for certain subsidiaries is very cyclical based on respective commodity markets.
Current wording
As Seaboard’s operations are heavily commodity-driven, financial performance for certain subsidiaries is very cyclical based on respective commodity markets. Beginning in the second quarter of 2024, Liquid Fuels is a separate reportable segment and the former Sugar and Alcohol segment is no longer a separate reportable segment. The historical periods presented have been recast to reflect these changes. See Note 7 to the condensed consolidated financial statements for further discussion.
Previous wording
Net sales for the three-month period of 2024 decreased $308 million compared to the same period in 2023. The decrease primarily reflected a decline of $154 million in CT&M segment sales due to lower prices of commodities sold and a $116 million decline in Marine segment sales due to lower average freight rates. See the net sales discussion by reportable segment below for more details.
Current wording
Net sales decreased $184 million and $492 million for the three- and six-month periods of 2024, respectively, compared to the same periods in 2023. The decrease for the three-month period reflected a decline of $204 million in CT&M segment sales primarily due to lower prices of commodities sold. The decrease for the six-month period primarily reflected a decline of $358 million in CT&M segment sales due to lower prices of commodities sold, partially offset by higher volumes sold, a decline in Marine segment sales of $147 million due to lower freight rates, and a decline in Liquid Fuels segment sales of $117 million due to lower volumes of fuel and environmental credits sold. The decreases were partially offset by an increase in Pork segment sales of $152 million due to higher selling prices and more pork products and market hogs sold. See the net sales discussion by reportable segment below for more details.
Previous wording
Operating loss decreased $43 million for the three-month period of 2024 compared to the same period in 2023. The change primarily reflected a decrease of $164 million in Pork segment operating loss due to higher margins on the sale of pork products and market hogs, partially offset by a $81 million decrease in Marine segment operating income due to lower voyage revenue and a $25 million decrease in CT&M segment operating income due to mark-to-market losses on derivative contracts. See the operating income discussion by reportable segment below for more details.
Current wording
Operating income increased $34 million and $77 million for the three- and six-month periods of 2024, respectively, compared to the same periods in 2023. The increase primarily reflected less Pork segment operating loss of $101 million and $282 million due to higher margins on the sale of pork products and market hogs, respectively, partially offset by a $42 million and $123 million decrease in Marine segment operating income due to lower voyage revenue, and a $28 million and $45 million decrease in Liquid Fuels segment operating income due to lower margins on fuel sales for the three- and six-month periods, respectively. See the operating income discussion by reportable segment below for more details.
Previous wording
The effective tax rate for the three-month period of 2024 increased compared to the three-month period of 2023 primarily due to higher earnings compared to prior year. In 2021, the Organisation for Economic Co-operation and Development released Pillar Two Model Rules (“Pillar Two”). The model is designed to ensure large multinational enterprises pay a minimum level of tax on the income arising in each jurisdiction where they operate. The rules include transitional safe harbors which provide temporary exemption of operations in some jurisdictions if certain criteria are met. Some foreign jurisdictions in which Seaboard operates enacted Pillar Two legislation effective in 2024, but the impact will not be material to Seaboard in 2024. Seaboard is continuing to monitor legislative developments across relevant jurisdictions and the potential impact on future results.
Current wording
The effective tax rate for the three- and six-month periods of 2024 was lower as compared to the same periods of 2023 due to increased federal and state tax credits. In 2021, the Organisation for Economic Co-operation and Development released Pillar Two Model Rules (“Pillar Two”). The model is designed to ensure large multinational enterprises pay a minimum level of tax on the income arising in each jurisdiction where they operate. The rules include transitional safe harbors that provide temporary exemption of operations in some jurisdictions if certain criteria are met. Some foreign jurisdictions in which Seaboard operates enacted Pillar Two legislation effective in 2024, but the impact will not be material to Seaboard in 2024. Seaboard is continuing to monitor legislative developments across relevant jurisdictions and the potential impact on future results.
Previous wording
The decrease in operating loss primarily reflected $180 million in higher margins on pork products and market hogs sold due to higher sales prices and lower hog production costs, including a decrease in adjustments to the lower of cost and net realizable value (“LCNRV”) inventory reserve of $92 million and lower feed costs of $37 million. An inventory adjustment has been necessary since the third quarter of 2022 to properly state the hog inventory balances at quoted future market
Current wording
The decrease in operating loss for the three- and six-month periods reflected higher margins on pork products and market hogs sold, primarily due to higher selling prices and lower hog production costs, including lower feed costs of $63 million and $100 million, respectively. Also, inventory adjustments to the lower of cost and net realizable value (“LCNRV”) reserve resulted in an increase of $40 million in operating loss for the three-month period and a $53 million decrease in operating loss for the six-month period based on a comparison of changes to the reserve per market prices at each respective period end. Inventory adjustments to the LCNRV reserve have been necessary since the third quarter of 2022 to properly state the hog inventory balances at quoted future market prices for pork products and grain costs. With the more favorable pork prices and lower grain commodity costs, the LCNRV reserve was not needed as of June 29, 2024. Management is unable to predict market prices for pork products, the cost of feed or third-party hogs for future periods; however, based on current conditions, management anticipates this segment to be near break-even for the remainder of 2024.
Previous wording
The decrease in sales was primarily due to lower average sales prices which decreased sales $306 million, partially offset by higher volumes sold which increased sales $152 million. Sales prices for many of Seaboard’s products are directly affected by both domestic and worldwide supply and demand for commodities and competing products, all of which are determined by constantly changing market forces.
Current wording
The decrease in sales for the three- and six-month periods was primarily due to lower average sales prices of commodities sold which decreased sales $239 million and $541 million, respectively. The decrease was partially offset by higher volumes sold, which increased sales $34 million and $183 million for the three- and six-month periods, respectively. Sales prices for many of Seaboard’s products are directly affected by both domestic and worldwide supply and demand for commodities and competing products, all of which are determined by constantly changing market forces.
Previous wording
The decrease in operating income primarily reflected the change of $35 million in mark-to-market adjustments on derivative contracts. Due to worldwide commodity price fluctuations, the uncertain political and economic conditions in the countries in which this segment operates and the volatility in the commodity markets, management is unable to predict sales and operating results for this segment for future periods. However, management anticipates this segment will be profitable for the remainder of 2024, without the effects of mark-to-market adjustments on derivative contracts that cannot be predicted.
Current wording
The increase in operating income for the three-month period primarily reflected the decrease of $13 million in mark-to-market losses on derivative contracts. The decrease in operating income for the six-month period reflected an increase of $22 million in mark-to-market losses on derivatives contracts, partially offset by higher margins due to lower commodity costs. Due to worldwide commodity price fluctuations, the uncertain political and economic conditions in the countries in which this segment operates and the volatility in the commodity markets, management is unable to predict sales and operating results for this segment for future periods; however, management anticipates this segment will be profitable for the remainder of 2024, without the effects of mark-to-market adjustments on derivative contracts that cannot be predicted.
Previous wording
Had Seaboard not applied mark-to-market accounting to its derivative instruments, operating income for this segment would have been higher by $28 million and lower by $7 million for the three-month period of 2024 and 2023, respectively. While management believes its commodity futures, options and foreign exchange contracts are primarily economic hedges of its firm purchase and sales contracts and anticipated sales contracts, Seaboard does not perform the extensive record-keeping required to account for these transactions as hedges for accounting purposes. Accordingly, while the changes in value of the derivative instruments were marked to market, the changes in value of the firm purchase or sales contracts were not. As products are delivered to customers, these existing mark-to-market adjustments should be primarily offset by realized margins or losses as revenue is recognized over time, and these mark-to-market adjustments could reverse in 2024. Eliminating these mark-to-market adjustments provides another presentation to compare and evaluate period-to-period financial results for this segment.
Current wording
Had Seaboard not applied mark-to-market accounting to its derivative instruments, operating income for this segment would have been higher by $1 million and $29 million for the three- and six-month periods of 2024, respectively, and higher by $14 million and $7 million for the three- and six-month periods of 2023, respectively. While management believes its commodity futures, options and foreign exchange contracts are primarily economic hedges of its firm purchase and sales contracts and anticipated sales contracts, Seaboard does not perform the extensive record-keeping required to account for these transactions as hedges for accounting purposes. Accordingly, while the changes in value of the derivative instruments were marked to market, the changes in value of the firm purchase or sales contracts were not. As products are delivered to customers, these existing mark-to-market adjustments should be primarily offset by realized margins or losses as revenue is recognized over time, and these mark-to-market adjustments could reverse in 2024. Eliminating these mark-to-market adjustments provides another presentation to compare and evaluate period-to-period financial results for this segment.
Previous wording
The decrease in operating income was primarily the result of lower voyage revenue, partially offset by lower voyage-related costs, such as charter-hire and slot costs and trucking costs due to lower rates. Management cannot predict changes in fuel costs or other voyage costs, cargo volumes or cargo rates for future periods; however, management anticipates this segment will be profitable for the remainder of 2024.
Current wording
The decrease in operating income for the three-month period was primarily the result of lower voyage revenue and an increase in terminal services and trucking costs due to higher cargo volumes, partially offset by lower charter-hire costs. The decrease in operating income for the six-month period was primarily the result of lower voyage revenue, partially offset by lower voyage-related costs, primarily charter-hire costs. More recently, charter-hire rates are rising due to increased global demand for vessels. Management cannot predict changes in fuel costs or other voyage costs, cargo
Previous wording
The decrease in operating income reflected lower revenue partially offset by a decrease in natural gas fuel costs. Management cannot predict fuel costs or the extent that spot market rates will fluctuate compared to fuel costs or other power producers for future periods; however, management anticipates this segment will be profitable for the remainder of 2024. While EDM II, the barge that began operations in 2012, remains in operation in the Dominican Republic, Seaboard continues to explore strategic alternatives for this barge, including a sale or relocation.
Current wording
The decrease in operating income for the three- and six-month periods primarily reflected lower revenue. During the three-month period of 2024, lower fuel costs due to less consumption were offset by higher fuel prices. During the six-month period of 2024, lower fuel costs due primarily to less consumption were partially offset by maintenance costs incurred in the first quarter of 2024. Management cannot predict fuel costs or the extent that spot market rates will fluctuate compared to fuel costs or other power producers for future periods; however, management anticipates this segment will be profitable for the remainder of 2024. While EDM II, the barge that began operations in 2012, remains in operation in the Dominican Republic, Seaboard continues to explore strategic alternatives for this barge, including a sale or relocation.
Previous wording
The Turkey segment represents Seaboard’s 52.5% investment in Butterball, which is accounted for using the equity method. Butterball’s net income decreased $33 million for the three-month period of 2024 compared to the same period in 2023. The decrease in net income was primarily the result of a $38 million decrease in sales due to a 7% decrease in the average selling price related to a decline in commodity pricing and a 3% decrease in volumes sold. The decrease in sales was partially offset by a 14% decrease in production costs, primarily related to lower feed costs. Management is unable to predict market prices for turkey products or the cost of feed for future periods; however, management anticipates this segment will be profitable for the remainder of 2024.
Current wording
The Turkey segment represents Seaboard’s 52.5% investment in Butterball, which is accounted for using the equity method. Butterball’s net income decreased $17 million and $50 million for the three- and six-month periods of 2024, compared to the same periods in 2023, respectively. The decrease in net income was primarily due to lower margins on turkey products sold. The decrease in sales of $51 million and $89 million for the three- and six-month periods, respectively, were partially offset by a decrease in production costs primarily related to lower feed costs. The average selling price decreased 7% for each period due to a decline in commodity pricing, and volumes sold decreased 5% and 4% for the three- and six-month periods, respectively. Management is unable to predict market prices for turkey products or the cost of feed for future periods; however, management anticipates this segment will be profitable for the remainder of 2024.
Previous wording
The preparation of Seaboard’s condensed consolidated financial statements requires Seaboard to make estimates, judgments, and assumptions. A summary of significant accounting policies and the critical accounting estimate is included in Seaboard’s annual report on Form 10-K for the year ended December 31, 2023. There were no changes to significant accounting policies or the critical accounting estimate during the three months ended March 30, 2024.
Current wording
The preparation of Seaboard’s condensed consolidated financial statements requires Seaboard to make estimates, judgments, and assumptions. A summary of significant accounting policies and the critical accounting estimate is included in Seaboard’s annual report on Form 10-K for the year ended December 31, 2023. There were no changes to significant accounting policies or the critical accounting estimate during the six months ended June 29, 2024.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
volumes or cargo rates for future periods; however, management anticipates this segment will be profitable for the remainder of 2024.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
For the remainder of 2024, management has budgeted capital expenditures totaling approximately $424 million. The Pork segment planned expenditures are primarily for biogas recovery projects, normal replacement of breeding herd and other investments. At certain hog farms, the Pork segment is constructing biogas recovery facilities to capture methane from its hog lagoons and inject it as renewable natural gas into the local pipeline infrastructure. The Marine segment planned expenditures include installment payments on vessels under construction. The payments for these vessels are made in accordance with milestones achieved throughout construction. Two vessels are expected to be complete in 2024 and six vessels are expected to be complete in 2025.
Previous report — wording carried elsewhere
Management anticipates paying for these capital expenditures from a combination of available cash, the use of available short-term investments and Seaboard’s available borrowing capacity.
Previous report — wording carried elsewhere
prices for pork products and grain costs. With more favorable pork prices and grain commodity costs, the need for the LCNRV adjustment was minimal for the first quarter of 2024. Renewable diesel margins decreased primarily as a result of the plant maintenance and repairs during the first quarter of 2024. Management is unable to predict market prices for pork products, biodiesel, renewable diesel or the cost of feed or third-party hogs for future periods; however, based on current conditions management anticipates this segment to be profitable for the remainder of 2024.