Investments in Affiliates

12 Months Ended

Dec. 31, 2023

Investments in Affiliates

Investments in Affiliates

Note 6 – Investments in Affiliates

Seaboard has investments in several non-consolidated affiliates to further its business strategies and partner with other entities that have expertise in certain industries and countries. These investments are all accounted for using the equity method of accounting.

	Investments in and				Income (Loss)
	Advances to Affiliates				from Affiliates
	December 31,				Years ended December 31,
(Millions of dollars)	2023		2022		2023		2022		2021
Pork	$	154	$	152	$	32	$	24	$	3
CT&M		164		210		(18)		21		18
Marine		38		36		3		4		6
Sugar and Alcohol		2		2		1		—		—
Power		3		3		—		—		—
Turkey		370		350		87		103		(20)
Segment/Consolidated Totals	$	731	$	753	$	105	$	152	$	7

As Seaboard conducts its agricultural commodity trading business with third parties, consolidated subsidiaries and non-consolidated affiliates on an interrelated basis, cost of sales on affiliate sales transactions cannot be distinguished without making numerous assumptions, primarily with respect to mark-to-market accounting for commodity derivatives. Purchases of raw materials or services from related parties included in cost of sales were $86 million and $91 million for the years ended December 31, 2023 and 2022, respectively.

The Pork segment has investments in Seaboard Triumph Foods, LLC (“STF”) (50%), which operates a pork processing plant, Daily’s Premium Meats, LLC (“Daily’s”) (50%), which produces raw and pre-cooked bacon, and Seaboard de Mexico USA LLC (“Seaboard de Mexico”) (50%), which debones hams. Seaboard’s Pork segment supplies raw materials to Daily’s, STF and Seaboard de Mexico for processing and also provides marketing services to Daily’s and STF for its pork products. STF supplies feedstock for the Pork segment’s renewable diesel operations. On January 1, 2022, Seaboard sold a 50% interest in Seaboard de Mexico to Triumph Foods, LLC, a partner in the Pork segment’s other joint ventures, for cash proceeds of approximately $9 million, net of cash sold. Combined financial information for the Pork segment’s non-consolidated affiliates was as follows:

Pork Segment		December 31,
(Millions of dollars)		2023		2022		2021
Net sales	$	2,205	$	2,417	$	2,010
Net income	$	65	$	48	$	5
Total assets	$	604	$	615	$	584
Total liabilities	$	299	$	312	$	302
Total equity	$	305	$	303	$	282

The CT&M segment has investments in foreign businesses conducting flour, maize and feed milling, baking operations, protein production and processing, and agricultural commodity trading. The CT&M segment supplies commodities to the majority of its milling affiliates. As of December 31, 2023, the location and percentage ownership of CT&M’s affiliates were as follows: Botswana (50%), Democratic Republic of Congo (50%), Gambia (50%), Kenya (18.47%-49%), Lesotho (50%), Mauritania (33.33%), Nigeria (25%-48.33%), Senegal (49%), South Africa (50%), Tanzania (11.76%-49%), Uganda (14.35%-49%) and Zambia (49%) in Africa; Colombia (40%-42%), Ecuador (25%-50%), Guyana (50%), and Peru (50%) in South America; Jamaica (50%) and Haiti (23.33%) in the Caribbean; Turkey (25%) in Europe; and Canada (45%) and the U.S. (20%) in North America. As of December 31, 2023, the CT&M segment’s carrying value of certain investments in affiliates was more than its share of the affiliates’ book value by $24 million. The excess is attributable primarily to the valuation of property, plant and equipment and intangible assets, with basis adjustments amortized to income (loss) from affiliates over the remaining life of the assets. During the fourth quarter of 2023, this segment lost significant influence of its Moroccan investments that had an aggregate value of $11 million at December 31, 2023, and as a result, these affiliates are accounted for under the cost method of accounting as of December 31, 2023 and their balance sheet information is not included below. During 2022, this segment sold a 20% interest in its North American protein and commodity trading company to the majority owner for cash proceeds of $12 million.

Combined financial information for the CT&M segment’s non-consolidated affiliates was as follows:

CT&M Segment	December 31,
(Millions of dollars)	2023			2022		2021
Net sales	$	3,088	$	3,186	$	2,766
Net income (loss)	$	(79)	$	40	$	47
Total assets	$	960	$	1,848	$	1,798
Total liabilities	$	569	$	1,250	$	1,199
Total equity	$	391	$	598	$	599

The Marine segment has an investment in a port terminal business in the Caribbean (21.02%) which provides terminal and stevedoring services to the Marine segment. As of December 31, 2023, the Marine segment’s carrying value of the investment in affiliates was less than its share of the affiliate’s book value by $17 million. The difference is attributable primarily to the valuation of property, plant and equipment due to different accounting methods, with basis adjustments amortized to income (loss) from affiliates over the remaining life of the assets. During 2023, this segment lost significant influence of an affiliate, and as a result, the investment is accounted for under the cost method of accounting as of December 31, 2023 and its financial information is not included below. Combined financial information for the Marine segment’s non-consolidated affiliates was as follows:

Marine Segment		December 31,
(Millions of dollars)		2023		2022		2021
Net sales	$	62	$	82	$	74
Net income	$	21	$	21	$	27
Total assets	$	233	$	256	$	245
Total liabilities	$	70	$	61	$	88
Total equity	$	163	$	195	$	157

The Sugar and Alcohol segment has investments in two sugar-related businesses in Argentina (50%). Combined financial information for the Sugar and Alcohol segment’s non-consolidated affiliates was as follows:

Sugar and Alcohol Segment	December 31,
(Millions of dollars)	2023			2022		2021
Net sales	$	7	$	8	$	6
Net income	$	1	$	—	$	—
Total assets	$	6	$	6	$	8
Total liabilities	$	2	$	2	$	1
Total equity	$	4	$	4	$	7

The Power segment has investments in two energy-related businesses in the Dominican Republic (45% and 50%). Combined financial information for the Power segment’s non-consolidated affiliates was as follows:

Power Segment	December 31,
(Millions of dollars)	2023			2022		2021
Net sales	$	—	$	1	$	1
Net income	$	—	$	—	$	1
Total assets	$	9	$	9	$	12
Total liabilities	$	3	$	3	$	5
Total equity	$	6	$	6	$	7

The Turkey segment represents Seaboard’s investment of 52.5% in Butterball. Seaboard does not have control of Butterball and all significant corporate governance matters are equally shared between Seaboard and its partner in Butterball. Within total assets, Butterball had trade name intangible assets of $111 million and goodwill of $61 million as of December 31, 2023. Butterball’s financial information was as follows:

Turkey Segment	December 31,
(Millions of dollars)	2023			2022		2021
Net sales	$	2,025	$	2,050	$	1,792
Operating income (loss)	$	182	$	202	$	(34)
Net income (loss)	$	166	$	196	$	(38)
Total assets	$	1,120	$	1,081	$	991
Total liabilities	$	408	$	406	$	517
Total equity	$	712	$	675	$	474