Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
This Management’s Discussion and Analysis is provided as a supplement to, and should be read in conjunction with, Seaboard’s consolidated financial statements and the accompanying notes in Item 8. Certain statements in this report contain forward-looking statements. See the introduction in Item 1 for more information on these forward-looking statements, including a discussion of the most significant factors that could cause actual results to differ materially from those in the forward-looking statements. For discussion related to the results of operations for 2024 compared to 2023 refer to Part II Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations in Seaboard’s Form 10-K for the year ended December 31, 2024.
OVERVIEW
Seaboard’s operations are heavily commodity-driven and financial performance for certain segments is cyclical based on respective global commodity markets and trends in economic activity. During 2025, the U.S. government imposed tariffs and trade restrictions on certain products from some foreign jurisdictions, and in response to these actions, some countries imposed retaliatory tariffs on certain products produced in the U.S. The impact of tariffs was not material to Seaboard’s 2025 results; however, Seaboard continues to monitor the current uncertainties with tariffs and other geopolitical conditions. Seaboard cannot be certain of the outcome, which could indirectly or directly adversely impact its future
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financial condition and results of operations. See Item 1A. Risk Factors for further discussion of risks associated with tariffs and other geopolitical conditions.
Pork Segment
The Pork segment primarily produces hogs to process and sells pork products throughout the U.S. and to foreign markets. Sales prices are directly affected by both domestic and worldwide supply and demand for pork products and other proteins. Feed accounts for the largest input cost of raising hogs and is materially affected by price changes for corn and soybean meal. Market prices for hogs purchased from third parties for processing at the plant also represent a significant cost factor. As a result, commodity price fluctuations can affect profitability and cash flows. This segment is Seaboard’s most capital-intensive segment, representing approximately 41% of Seaboard’s total fixed assets and approximately 37% of total inventories as of December 31, 2025. With the plant generally operating near capacity, Seaboard is continually looking for ways to enhance the plant’s operational efficiency, while also looking to increase margins by introducing new, higher margin value-added products. This segment also produces swine-derived renewable natural gas, but sales are not significant as most facilities are in the early stages of operation. Consistent production at each facility may take longer than expected as it is dependent upon a number of variables, including the maturity and volatile solid concentration of the lagoon, weather, hog health and methanogen health.
CT&M Segment
The CT&M segment provides integrated agricultural commodity trading, processing and logistics services. The majority of its sales are derived from sourcing agricultural commodities from multiple origins and delivering them to third-party and affiliate customers in various international locations. This segment’s sales are significantly affected by fluctuating prices of various commodities, such as wheat, corn and soybean meal. Exports from various countries can exacerbate volatile market conditions. Profit margins are sometimes protected through commodity derivatives and other risk management practices, but the execution of these purchase and delivery transactions have long cycles of completion, which may extend for several months with a high degree of price volatility. As a result, these factors can significantly affect sales volumes, operating income, working capital and related cash flows from period to period. Consolidated subsidiaries and non-consolidated affiliates operate the grain milling facilities in foreign countries that are, in most cases, lesser developed and are more likely to be significantly impacted by changes in local crop production, political instability and local government policies, as well as fluctuations in economic and industry conditions and foreign currency exchange rates. This segment represents approximately 37% of Seaboard’s total inventories as of December 31, 2025.
Marine Segment
The Marine segment provides cargo shipping services in the U.S., the Caribbean and Central and South America. Fluctuations in economic conditions and political instability in the regions or countries in which this segment operates may affect trade volumes and operating profits. In addition, freight rates can fluctuate depending on regional supply and demand for shipping services. Since this segment time-charters ocean cargo vessels, it is affected by fluctuations in charter hire rates.
Liquid Fuels Segment
The Liquid Fuels segment produces biodiesel and renewable diesel and generates related environmental credits, specifically LCFS credits and RINs, and production tax credits. The profitability of this segment is impacted by world diesel prices, the market prices of pork fat, other animal fats and vegetable oils, all of which are utilized to produce biodiesel and renewable diesel, government mandates and incentives to use biofuels and the market price of environmental credits.
Power Segment
The Power segment is an independent power producer in the Dominican Republic. Spot market rates are impacted by fuel prices and the various producers supplying power to the grid. While fuel is this segment’s largest cost component and is subject to price fluctuations, higher fuel costs generally have been passed on to customers.
Turkey Segment
The Turkey segment represents Seaboard’s 52.5% non-controlling investment in Butterball, which is accounted for using the equity method of accounting. Butterball produces turkeys to process and sells turkey products. Sales prices are directly affected by both domestic and worldwide supply and demand for turkey products and other proteins. Feed accounts for the largest input cost of raising turkeys and is materially affected by price changes for corn and soybean meal. As a result, price fluctuations for corn and soybean meal affect profitability and cash flows.
LIQUIDITY AND CAPITAL RESOURCES
The primary objectives of Seaboard’s financing strategy are to effectively manage financial risks, ensure efficient liquidity for daily global operations and maintain balance sheet strength. Seaboard’s principal funding sources are generated from operating activities, short-term investments and borrowings from lines of credit and term loans. Seaboard’s cash
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requirements primarily include funding for working capital, capital expenditures, strategic investments and other needs. Management evaluates overall liquidity at least on a quarterly basis, and management believes Seaboard’s combination of internally-generated cash, liquidity and borrowing capabilities will be adequate to meet all short-term and long-term commitments.
As of December 31, 2025, Seaboard had cash and short-term investments of $1.2 billion and additional total working capital of $890 million. As of December 31, 2025, $161 million of the $1.2 billion of cash and short-term investments were held by Seaboard’s foreign subsidiaries. Seaboard considers substantially all foreign profits permanently reinvested in its foreign operations, except for previously-taxed undistributed earnings of Seaboard Marine and earnings of certain other foreign subsidiaries.
The following table presents a summary of Seaboard’s available borrowing capacity under lines of credit.
Total amount
(Millions of dollars) available
Short-term uncommitted and committed lines $ 1,417
Amounts drawn against lines (458)
Available borrowing capacity as of December 31, 2025 $ 959
Available borrowing capacity fluctuates based on changes to the terms of line of credit agreements and draws needed to fund operations. During 2025, Seaboard reduced its borrowing capacity under the committed line of credit from $450 million to $300 million.
As of December 31, 2025, Seaboard had long-term debt of $991 million, which included the Term Loan due 2033 of $953 million. Current maturities of long-term debt were $11 million as of December 31, 2025. See Note 7 to the consolidated financial statements for more discussion on lines of credit and long-term debt. Seaboard will continue to evaluate opportunities to access efficient financing in the markets where it operates, leveraging low-cost funding to support its operations.
Cash Flows
Cash generated from operating activities was $568 million for the year ended December 31, 2025, compared to $519 million for 2024. The increase in operating cash flows was due to an increase in earnings, adjusted for non-cash items of $57 million, larger proceeds from investment tax credit sales of $53 million and increased dividend payments received of $27 million from equity method investments, partially offset by an increase in cash used for working capital of $88 million. The working capital fluctuation was primarily inventory-related due to production tax credits in Seaboard’s Liquid Fuels segment, and to a lesser extent, timing of sales and related cash receipts and inventory purchases in Seaboard’s Pork segment. There have been no sales of production tax credits to monetize this inventory during 2025.
Cash used in investing activities was $543 million for the year ended December 31, 2025, compared to $484 million for 2024. During 2025, Seaboard invested $562 million in property, plant and equipment, an increase of $51 million from the same period in the prior year. Of the 2025 total investment, $302 million was in the Marine segment, consisting primarily of installment payments on vessels under construction. Six new dual-fueled vessels were completed and delivered during 2025, the last of the original eight ordered vessels. In 2025, Seaboard Marine entered into an agreement to build a ninth new vessel at a cost of approximately $75 million. The new dual-fueled vessels bring greater fuel efficiency, increased twenty-foot equivalent unit (“TEU”) capacity and a host of other advantages to the Marine segment’s fleet and create a better overall fleet balance of owned and chartered vessels. 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. Also, during 2025, Seaboard rebalanced its short-term investments portfolio using different investment vehicles in some cases, such as private funds. See Note 2 to the consolidated financial statements for further discussion. Additionally, during 2025, Seaboard continued to invest in long-term investments with a $50 million purchase of equity interests in a fund that owns corporate debt securities.
Cash provided by financing activities was $44 million for the year ended December 31, 2025, compared to $12 million for 2024. Cash flows from financing activities primarily include draws and repayments under committed and uncommitted lines of credit held with financial institutions across multiple jurisdictions and currencies. The daily needs for working capital primarily influence changes in Seaboard’s borrowing balances. During 2025, Seaboard’s Board of Directors approved a share repurchase program and Seaboard repurchased 13,261 Shares for $39 million, including excise taxes for the year ended December 31, 2025. The timing and volume of share repurchases will be determined by management at its discretion and will depend on a number of factors, including constraints specified in any applicable trading plans, the market price of the Shares, general business and market conditions, alternative investment opportunities, Seaboard’s
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financial condition and applicable legal requirements. The share repurchase program does not obligate Seaboard to acquire a minimum amount of Shares, and Seaboard cannot predict when, or if, it will repurchase any Shares or the amount of any such repurchases.
Capital Expenditures and Other Investments
Seaboard continues to make investments in its operations. The total budget for 2026 capital expenditures is approximately $625 million, and includes $150 million for the Power segment’s expenditures related to the construction of EDM IV, which is expected to commence operations in 2028, along with several projects individually immaterial across the remaining segments. The total estimated cost of the EDM IV barge project is approximately $315 million, with installment payments due based on milestones achieved. Management anticipates funding these capital expenditures from a combination of available cash, the use of available short-term investments and Seaboard’s available borrowing capacity.
Based on specific facts and circumstances, Seaboard may also fund capital calls and issue borrowings for its equity method investments. Seaboard continues to look for opportunities to further grow and diversify its operations. Management intends to utilize existing liquidity, available borrowing capacity and other financing alternatives to fund these opportunities. The terms and availability of such financing may be impacted by economic and financial market conditions, as well as Seaboard’s financial condition and results of operations at the time Seaboard seeks such financing, and there can be no assurances that Seaboard will be able to obtain such financing on terms that will be acceptable or advantageous.
Future Contractual Obligations
Other than those obligations discussed above, future obligations mostly include normal operating expenses. For operating and finance leases, Seaboard had a current and noncurrent undiscounted obligation of $177 million and $396 million, respectively, as of December 31, 2025; see Note 5 to the consolidated financial statements for further discussion on leases. The majority of Seaboard’s purchase commitments for materials or supplies are related to grain, freight, fuel and hog procurement contracts with a current obligation of approximately $1.2 billion and a long-term obligation of approximately $1.8 billion as of December 31, 2025; see Note 8 to the consolidated financial statements for further discussion on commitments. These purchase commitments are of a normal, recurring nature with our commodity businesses and as agreements expire throughout the year they are renewed. Also, Seaboard is subject to obligations under its existing pension plans. As of December 31, 2025, the unfunded status of the non-qualified plans was $56 million. For additional information about Seaboard’s pension plans, see Note 9 to the consolidated financial statements.
RESULTS OF OPERATIONS
Net sales for the years ended December 31, 2025, 2024 and 2023 were $9.8 billion, $9.1 billion and $9.6 billion, respectively. The increase in sales of $646 million for 2025 compared to 2024 primarily reflected a $456 million increase in CT&M segment sales due to higher volumes of commodities and a $217 million increase in Marine segment sales due to increased voyage revenue. See the net sales discussion by reportable segment below for more details.
Operating income (loss) for the years ended December 31, 2025, 2024 and 2023 was $239 million, $156 million and ($87) million, respectively. The increase in operating income of $83 million for 2025 compared to 2024 primarily reflected an $83 million increase in Marine segment operating income due to higher voyage revenue, partially offset by higher voyage-related costs. See the operating income discussion by reportable segment below for more details.
Selling, General and Administrative Expenses
Selling, general and administrative expenses increased $34 million for the year ended December 31, 2025, compared to 2024 primarily due to higher personnel costs and bad debt expense of $8 million.
Interest Expense
Interest expense decreased $2 million for the year ended December 31, 2025, compared to 2024 primarily due to lower interest rates on outstanding debt, partially offset by a decrease of $18 million in capitalized interest on construction in progress.
Income Tax Benefit (Expense)
The 2025 effective tax rate decreased compared to 2024 primarily due to the reversal of the valuation allowance recorded on certain U.S. deferred tax assets in the prior year. During 2024, Seaboard established a valuation allowance against its U.S. deferred tax asset balances of $212 million as Seaboard’s U.S. operations were in a historical three-year cumulative loss position and, based on the weight of available evidence, Seaboard determined that it was more likely than not that the benefit of the deferred tax assets would not be realized. However, as of December 31, 2025, Seaboard’s U.S. operations were in a three-year cumulative income position and, based on the weight of available evidence, Seaboard has determined that it is more likely than not that the deferred tax assets will be utilized. Seaboard released substantially all of its U.S. valuation allowance, resulting in an income tax benefit of $170 million for the year ended
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December 31, 2025. A valuation allowance remains recorded on certain U.S. and foreign deferred tax attributes that are not more likely than not to be realized. See Note 12 to the consolidated financial statements for further discussion.
Segment Results
See Note 13 to the consolidated financial statements for a reconciliation of net sales and operating income by reportable segment to consolidated net sales and consolidated operating income, respectively.
Pork Segment
(Millions of dollars) 2025 2024 2023 $ $
Operating income (loss) $ 67 $ 20 $ (455) $ 47 $ 475
Income from affiliates $ 34 $ 26 $ 33 $ 8 $ (7)
The decrease in net sales for the year ended December 31, 2025, compared to 2024 was due to lower volumes of pork products, and to a lesser extent, market hogs sold, which decreased sales $106 million and $37 million, respectively, partially offset by higher sales prices which increased sales $108 million. Lower sales volumes were primarily due to the availability of hogs related to diseases and timing of deliveries to the processing plants.
The increase in operating income for the year ended December 31, 2025, compared to 2024 reflected higher margins on pork products and market hogs sold, primarily due to higher sales prices and lower hog production costs, including lower feed costs of $160 million. Higher margins were partially offset by favorable adjustments to the lower of cost and net realizable value (“LCNRV”) inventory reserve in 2024 with no adjustments in 2025, an increase in legal claims expense and lower sales volumes. With improved pork prices and lower grain commodity costs, the LCNRV inventory reserve decreased $42 million during the first half of 2024 and has not been needed since. While management anticipates the Pork segment will be profitable in 2026, no assurances can be made as it is difficult to predict market prices for pork products, the cost of production or third-party hogs and the impact of tariffs for future periods.
CT&M Segment
(Millions of dollars) 2025 2024 2023 $ $
Income (loss) from affiliates $ 17 $ 17 $ (18) $ — $ 35
Net sales increased for the year ended December 31, 2025, compared to 2024 primarily due to higher volumes of certain commodities sold, which increased sales $743 million, partially offset by 5% lower average sales prices, which decreased sales $287 million. Sales prices for 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.
Operating income increased for the year ended December 31, 2025, compared to 2024 primarily due to an increase of $31 million in mark-to-market gains on derivative contracts, which continue to fluctuate until final delivery of product, and higher margins on certain commodities sold at trading offices, partially offset by lower margins at certain mills driven by government price controls and higher selling, general and administrative expenses of $19 million due to bad debt expense and salaries and benefits. While management anticipates positive operating income, excluding the effects of mark-to-market adjustments, for this segment in 2026, no assurances can be made as it is difficult to predict worldwide commodity price fluctuations and the uncertain political and economic conditions in the countries in which this segment operates.
Marine Segment
(Millions of dollars) 2025 2024 2023 $ $
The increase in net sales for the year ended December 31, 2025, compared to 2024 was due to higher freight rates and cargo volumes. The increase in average freight rates was driven by various freight rate increases and a more favorable mix of cargo types. Cargo volumes in 2025 increased 7% compared to 2024.
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The increase in operating income for the year ended December 31, 2025, compared to 2024 was primarily the result of higher voyage revenue, partially offset by higher voyage-related costs, such as stevedoring, terminal services, trucking costs and slot costs, which are primarily driven by higher cargo volumes. Many of this segment’s costs are variable in nature and the overall expense amounts will fluctuate as volumes increase or decrease. While management anticipates this segment will be profitable in 2026, no assurances can be made as it is difficult to predict changes in cargo volumes, cargo rates, fuel costs or other voyage costs for future periods.
Liquid Fuels Segment
(Millions of dollars) 2025 2024 2023 $ $
Operating loss $ (127) $ (100) $ (73) $ (27) $ (27)
The increase in net sales for the year ended December 31, 2025, compared to 2024 was driven by higher environmental credit and fuel sales, partially offset by the expiration of the federal blender’s tax credit, as $125 million of credits were recognized during 2024 compared to none in 2025. The expired federal blender’s tax credit was replaced by a new clean fuel production tax credit effective January 1, 2025, that is recorded as a reduction to cost of sales. Higher prices and volumes of environmental credits sold increased sales $69 million and $28 million, respectively, and higher prices and volumes of fuel sold increased sales $66 million and $10 million, respectively, as compared to 2024. The increase in volume of fuel and credits sold primarily related to renewable diesel sales as the plant was not operational for four months during the first half of 2024 due to repairs as compared to regularly scheduled maintenance performed during 2025.
The increase in operating loss for the year ended December 31, 2025, compared to 2024 was primarily due to 19% higher feedstock costs and lower income recognized from the production tax credits as compared to the federal blender’s tax credits, partially offset by higher environmental credit and fuel revenue. The 2025 income from production tax credits accounted for 52% of the total income generated by federal blender’s tax credits in 2024, inclusive of volume fluctuations. The production tax credit value varies based on the greenhouse gas emissions factor of fuel produced. Based on current market conditions, management anticipates near break-even results in 2026, but no assurances can be made as it is difficult to predict market prices for biodiesel, renewable diesel and credits, the cost of feedstock or production levels for future periods.
Power Segment
(Millions of dollars) 2025 2024 2023 $ $
Operating income $ 46 $ 61 $ 71 $ (15) $ (10)
The decrease in net sales for the year ended December 31, 2025, compared to 2024 reflected a decrease in power generation from EDM III primarily due to more power generation from lower variable-cost producers and timing of maintenance performed that more than offset EDM II’s increased power generation.
The decrease in operating income for the year ended December 31, 2025, compared to 2024 wasprimarily driven by the decrease in net sales and higher fuel costs, primarily heavy fuel oil, due to increased consumption for EDM II. Generally, heavy fuel oil is more expensive than natural gas. While management anticipates this segment will be profitable in 2026, no assurances can be made as it is difficult to predict fuel costs or the extent that spot market rates will fluctuate due to fuel costs or other power producers for future periods.
Turkey Segment
(Millions of dollars) 2025 2024 2023 $ $
Income from affiliate $ 82 $ 37 $ 87 $ 45 $ (50)
The Turkey segment represents Seaboard’s non-controlling 52.5% investment in Butterball, which is accounted for using the equity method. The increase in Butterball’s net income of $84 million for the year ended December 31, 2025, compared to 2024 was the result of increased sales attributable to 10% higher volumes of turkey products sold and 2% higher prices, partially offset primarily by 16% higher plant costs due to more volumes sold. While management anticipates this segment will be profitable for 2026, no assurances can be made as it is difficult to predict market prices for turkey products, the cost of production for future periods and impacts from diseases.
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CRITICAL ACCOUNTING ESTIMATES
The preparation of Seaboard’s consolidated financial statements requires management to make estimates, judgments and assumptions. See Note 1 to the consolidated financial statements for a discussion of significant accounting policies.Management has identified the accounting estimates believed to be the most important to the portrayal of Seaboard’s financial condition and results of operations and that require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of inherently uncertain matters. Management has reviewed these critical accounting estimates with the Audit Committee of the Board of Directors.
Income Taxes
Seaboard must make estimates and apply judgment in determining the provision for income taxes for financial reporting purposes. As of each reporting date, management considers new information that could affect its conclusions regarding the future realization of Seaboard’s deferred tax assets. In evaluating Seaboard’s ability to recover deferred tax assets within the jurisdiction from which they arise, management considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax-planning strategies and results of recent operations. Circumstances may change over time such that previous negative evidence no longer exists, and new conditions should be evaluated as positive or negative evidence that could affect the realization of the deferred tax assets. Seaboard might rely more on forecasts in the future for certain evidence and given the inherent uncertainty involved, there can be significant differences between anticipated and actual results. Unforeseen events may significantly impact forecasts or actual results, and these changes could have a material impact on Seaboard’s income taxes. Changes in estimates and judgments may result in a material increase or decrease to the tax provision, which would be recorded in the period in which the change occurs.
During the third quarter of 2024, after considering U.S. pre-tax book income and the effects of permanent differences, Seaboard’s U.S. operations were in a historical three-year cumulative loss position, which is significant objective negative evidence in considering whether deferred tax assets are realizable. Under U.S. GAAP, the presence of a three-year cumulative loss limits Seaboard’s ability to consider other subjective evidence, such as its expectations of future taxable income and projections of growth. As a result, Seaboard recorded a valuation allowance and related charge to income tax expense of $212 million for the year ended December 31, 2024. During the fourth quarter of 2025, Seaboard’s U.S. operations were in a historical three-year cumulative income position. After evaluating both positive and negative evidence, Seaboard reversed its valuation allowance on certain domestic deferred tax assets. Seaboard recognized $170 million of income tax benefit during 2025 as a result of changes in the valuation allowance in the U.S. As of December 31, 2025, Seaboard had a valuation allowance of $72 million, of which $46 million relates to domestic deferred tax assets.
Impairment of Long-Lived Assets
Seaboard tests its long-lived asset groups for impairment when changes in circumstances indicate their carrying value may not be recoverable. Events that trigger a test for recoverability include;
• Material adverse changes in projected revenues or expenses, present negative cash flows combined with a history of negative cash flows and a forecast that demonstrates significant continuing losses;
• Adverse change in legal factors or significant negative industry or regulatory trends (such as overcrowding of market offerings or changes in regulations, resulting in excess capacity relative to market demand);
• Current expectation that a long-lived asset group will be disposed of significantly before the end of its useful life;
• Significant adverse change in the manner in which an asset group is used or in its physical condition; and
• Significant change in the asset grouping
When a triggering event occurs, a test for recoverability is performed, comparing projected undiscounted future cash flows to the carrying value of the asset group. Asset groups are tested at the level of the smallest identifiable group of assets that generate cash flows that are largely independent of the cash flows from other assets or groups of assets. Inherent in management’s development of cash flow projections are assumptions and estimates derived from a review of Seaboard’s operating results, business plan forecasts, expected growth rates and cost of capital, similar to those a market participant would use to assess fair value. Management also makes certain assumptions about future economic conditions and other data. Many of the factors used in assessing fair value are outside the control of management, and these assumptions and estimates may change in future periods. During 2025, continued operating losses in Seaboard’s Liquid Fuels’ segment were identified as a triggering event requiring an impairment analysis. Management subsequently performed a recoverability test on this asset group, which has a carrying value of approximately $345 million as of December 31, 2025. The test indicated that the sum of the estimated undiscounted future cash flows, based on the remaining useful life of the primary asset, the renewable diesel plant, exceeded the asset group's carrying value by greater than 100%. Accordingly,
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no impairment charge was recorded. These cash flow projections are highly dependent on certain significant assumptions, most notably forecasts of fuels and environmental credit sales prices and feedstock costs. Management continues to monitor the performance of this segment and these key assumptions closely.
NEW ACCOUNTING PRONOUNCEMENTS
See Note 1 to the consolidated financial statements for a discussion of recently issued accounting standards.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
Seaboard is exposed to various types of market risks in its day-to-day operations. Primary market risk exposures result from changing commodity prices, foreign currency exchange rates, interest rates and equity prices. Occasionally derivatives are used to manage these overall market risks; however, Seaboard does not perform the extensive record-keeping required to account for derivative transactions as hedges. As a result, fluctuations in the related prices could have a material impact on earnings in any given year. From time to time, Seaboard also enters into speculative derivative transactions related to its market risks.
Commodity price changes affect the cost of necessary raw materials and other inventories, finished product sales and firm sales commitments. Seaboard uses various grain, hog, oilseed and other commodity futures and options purchase contracts to manage certain risks of increasing prices of inventories and firm sales commitments or anticipated sales contracts. Short sales contracts are used to offset the open purchase derivatives when the related commodity inventory is purchased in advance of the derivative maturity, effectively offsetting the initial futures or option purchase contract.
Volatility in foreign currency exchange rates, caused by political and economic conditions of the countries in which Seaboard does business, along with fluctuations in the value of the U.S. dollar, exposes Seaboard to fluctuating foreign currency gains and losses that cannot be predicted. Since changes in foreign currency exchange rates affect the cash paid or received on foreign currency-denominated receivables and payables, Seaboard manages certain of these risks through the use of foreign currency exchange agreements.
The following table presents the sensitivity of the fair value of Seaboard’s derivatives to a hypothetical 10% change in market prices and foreign exchange rates as of December 31, 2025 and 2024. The fair value is calculated for each item by valuing each net position at quoted market prices as of the applicable date.
(Millions of dollars) December 31, 2025 December 31, 2024
Grains and oilseeds $ 23 $ 34
Vegetable oils 1 —
Hogs and pork products 1 3
Foreign currencies 21 36
Equity price risk is the risk that Seaboard may incur losses due to adverse changes in the market prices of the equity securities it holds in its short-term investment portfolio. Market prices for equity securities are subject to fluctuation and may result from perceived changes in the underlying economic characteristics of the investee, the relative price of alternative investments and general market conditions. As of December 31, 2025 and 2024, a hypothetical 10% change in market prices of Seaboard’s equity securities would have impacted results of operations by $86 million and $30 million, respectively. As of December 31, 2025, the underlying investments of several equity securities are debt securities, and accordingly, will not have as much exposure to equity price risk in general.
As changes in interest rates affect the cash required to service variable-rate debt, Seaboard may use interest rate exchange agreements to manage risks of increasing interest rates. At December 31, 2025, Seaboard had variable-rate long-term debt outstanding of $953 million with an interest rate of 5.39%. A hypothetical 10% change in interest rates effective at December 31, 2025, would have had an immaterial impact on interest expense. Long-term debt sensitive to changes in interest rates as of December 31, 2024 totaled $963 million with an interest rate of 6.08%.
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Item 8. Financial Statements and Supplementary Data
Report of Independent Registered Public Accounting Firm
To the Stockholders and Board of Directors
Seaboard Corporation:
Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting
We have audited the accompanying consolidated balance sheets of Seaboard Corporation and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of comprehensive income, changes in equity, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes (collectively, the consolidated financial statements). We also have audited the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
Basis for Opinions
The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
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Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
(i) Sufficiency of audit evidence over net sales
As described in Note 13 to the consolidated financial statements, the Company earned $9.7 billion of net sales in 2025. Net sales were primarily generated by the Company’s Pork, Commodity Trading and Milling, Marine, Liquid Fuels, and Power operations, which were dispersed over numerous countries. We identified the evaluation of the sufficiency of audit evidence over net sales as a critical audit matter. Evaluating the sufficiency of audit evidence obtained required auditor judgment due to the geographical dispersion of net sales. Furthermore, given the disaggregation of local management and language differences between locations, our audit team consisted of auditors located in multiple countries around the world. The following are the primary procedures we performed to address this critical audit matter. We evaluated the nature and amounts of the Company’s net sales at its various locations and applied auditor judgment to determine the locations at which procedures were to be performed. We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s net sales process, including controls related to the recognition of global net sales amounts. We tested samples of individual net sales transactions by comparing the amounts recognized by the Company to relevant underlying documentation such as purchase orders, contractual arrangements, and delivery documents, as applicable. We also performed a software-assisted data analysis to test relationships among certain revenue transactions. In addition, we evaluated the sufficiency of audit evidence obtained over net sales by assessing the results of procedures performed, including the appropriateness of the nature and extent of audit effort.
We have served as the Company’s auditor since 1959.
Kansas City, Missouri
February 12, 2026
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SEABOARD CORPORATION
Consolidated Statements of Comprehensive Income
Years ended December 31,
Net sales:
Cost of sales and operating expenses:
Total cost of sales and operating expenses 9,053 8,524 9,246
Selling, general and administrative expenses 454 420 403
Operating income (loss) 239 156 (87)
Interest expense (includes $1, $1 and $0 from affiliates) (70) (72) (58)
Income from affiliates 138 85 105
Earnings before income taxes 410 246 107
Income tax benefit (expense) 91 (156) 120
Less: Net earnings attributable to noncontrolling interests (5) (2) (1)
Net earnings attributable to Seaboard $ 496 $ 88 $ 226
Foreign currency translation adjustment 28 4 (3)
Unrecognized pension benefit 7 30 15
Other comprehensive income, net of tax $ 35 $ 34 $ 12
Comprehensive income attributable to Seaboard $ 531 $ 122 $ 238
See accompanying notes to consolidated financial statements.
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SEABOARD CORPORATION
Consolidated Balance Sheets
December 31,
(Millions of dollars except share and per share amounts) 2025 2024
Assets
Current assets:
Cash and cash equivalents $ 178 $ 98
Receivables:
Due from affiliates 97 87
Other (includes $1 and $5 due from affiliates) 111 166
Total receivables 797 822
Allowance for credit losses (42) (31)
Other current assets 131 146
Operating lease right-of-use assets, net 362 382
Investments in and advances to affiliates 795 738
Long-term investments 208 141
Deferred tax asset 145 69
Other non-current assets (includes $6 and $1 due from affiliates) 118 93
Liabilities and Stockholders’ Equity
Current liabilities:
Lines of credit $ 458 $ 314
Accounts payable (includes $32 and $31 due to affiliates) 397 418
Accrued compensation and benefits 122 128
Deferred revenue (includes $18 and $17 due to affiliates) 77 83
Operating lease liabilities 113 134
Accrued voyage costs 78 74
Other current liabilities 265 256
Total current liabilities 1,510 1,407
Long-term debt, less current maturities 977 987
Long-term operating lease liabilities 275 276
Accrued pension liability 71 67
Deferred tax liability 31 32
Other non-current liabilities 147 147
Commitments and contingent liabilities
Stockholders’ equity:
Accumulated other comprehensive loss (341) (376)
Total Seaboard stockholders’ equity 5,212 4,729
Noncontrolling interests 23 20
Total liabilities and equity $ 8,246 $ 7,665
See accompanying notes to consolidated financial statements.
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SEABOARD CORPORATION
Consolidated Statements of Changes in Equity
Accumulated
Other
Common Comprehensive Retained Noncontrolling
Comprehensive income:
Net earnings — — 226 1 227
Other comprehensive income, net of tax — 12 — — 12
Repurchase of common stock from affiliates — — (608) — (608)
Distributions to noncontrolling interests — — — (1) (1)
Dividends on common stock, $9.00/share — — (10) — (10)
Comprehensive income:
Net earnings — — 88 2 90
Other comprehensive income, net of tax — 34 — — 34
Dividends on common stock, $9.00/share — — (9) — (9)
Comprehensive income:
Net earnings — — 496 5 501
Other comprehensive income, net of tax — 35 — — 35
Repurchase of common stock — — (39) — (39)
Distributions to noncontrolling interests — — — (2) (2)
Dividends on common stock, $9.00/share — — (9) — (9)
See accompanying notes to consolidated financial statements.
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SEABOARD CORPORATION
Consolidated Statements of Cash Flows
Years ended December 31,
Operating activities:
Depreciation and amortization 318 311 283
Deferred income taxes (76) 130 (154)
Income from affiliates (138) (85) (105)
Investment gains, net (39) (19) (85)
Dividends received from affiliates 91 64 117
Other, net 11 40 7
Changes in assets and liabilities:
Receivables, net of allowance 26 (46) 176
Other assets 13 (12) 3
Accounts payable (42) (5) (32)
Other liabilities, exclusive of debt (4) (10) 73
Net cash from operating activities 568 519 710
Investing activities:
Purchase of short-term investments (2,851) (1,366) (2,519)
Capital expenditures (562) (511) (506)
Proceeds from sale of property, plant and equipment 35 34 34
Purchase of long-term investments (80) (13) (16)
Other, net 3 4 (12)
Net cash used in investing activities (543) (484) (273)
Financing activities:
Uncommitted lines of credit, net 133 (10) (172)
Draws under committed line of credit 818 1,440 1,173
Repayments of committed line of credit (809) (1,370) (1,199)
Proceeds from long-term debt — — 310
Principal payments of long-term debt (11) (10) (8)
Proceeds from payable to affiliate — 29 —
Finance lease payments (38) (49) (57)
Dividends paid (9) (9) (10)
Other, net (1) (1) (18)
Net cash from (used in) financing activities 44 12 (581)
Effect of exchange rate changes on cash and cash equivalents 11 (5) 1
Net change in cash and cash equivalents 80 42 (143)
Cash and cash equivalents at beginning of year 98 56 199
Cash and cash equivalents at end of year $ 178 $ 98 $ 56
Supplemental cash flow information
Amounts paid during the year for:
Interest, net of interest capitalized $ 75 $ 57 $ 56
Non-cash additions to property, plant and equipment 18 25 4
See accompanying notes to consolidated financial statements.
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SEABOARD CORPORATION
Notes to Consolidated Financial Statements
Note 1− Summary of Significant Accounting Policies
Operations of Seaboard Corporation and its Subsidiaries
Seaboard Corporation and its subsidiaries (collectively, “Seaboard”) together comprise a diversified group of companies that operate worldwide in agricultural, energy and ocean transport businesses. Seaboard is primarily engaged in hog production, pork processing and biofuel production in the United States (“U.S.”); commodity trading and grain processing in Africa and South America; cargo shipping services in the U.S., Caribbean and Central and South America; and electric power generation in the Dominican Republic. Seaboard also has an equity method investment in Butterball, LLC (“Butterball”), a producer and processor of turkey products. Seaboard’s outstanding common stock is closely held, with approximately 74% collectively owned by Seaboard Flour LLC and SFC Preferred, LLC.
Principles of Consolidation
The consolidated financial statements include the accounts of Seaboard Corporation and its domestic and foreign subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Financial information from certain foreign subsidiaries is reported on a one- to three-month lag, depending on the specific entity.
Investments in Affiliates
Investments in non-consolidated affiliates, where Seaboard has significant influence but does not have a controlling interest, are accounted for by the equity method. Under the equity method of accounting, the initial investment is recorded at cost and the investment is subsequently adjusted for its proportionate share of earnings or losses and dividends, including consideration of basis differences resulting from the difference between the initial carrying amount of the investment and the underlying equity in net assets. Seaboard reviews its investments in affiliates for impairment whenever events or changes in business circumstances indicate that the carrying amount of the investments may not be fully recoverable. For the Commodity Trading & Milling (“CT&M”) segment, investments in affiliates are primarily in foreign countries, which are less developed than the U.S. and therefore expose Seaboard to greater financial risks. At certain times when there are ongoing losses, local economies are depressed, commodity-based markets are less stable or foreign governments cause challenging business conditions, management evaluates the fair value of the equity method investments for impairment. As the fair value of these investments is not readily determinable, management uses other methods to determine fair value such as estimated future cash flows, including assumptions on growth rates and consideration of other local business conditions as applicable.
Use of Estimates
These financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”), which require management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Foreign Currency Transactions and Translation
Seaboard has operations in several foreign countries, and the currencies of the countries fluctuate in relation to the U.S. dollar, resulting in foreign currency gains and losses. Certain CT&M segment subsidiaries located in Ivory Coast, Senegal and Zambia use local currency as their functional currency. Assets and liabilities of these subsidiaries are translated to U.S. dollars at period-end exchange rates, and income and expenses are translated at average exchange rates. Translation gains and losses are recorded as components of other comprehensive income. Also, certain non-consolidated affiliates, primarily in the CT&M segment, use local currency as their functional currency.
Cash and Cash Equivalents
Cash equivalents include all demand deposits, overnight investments and other highly liquid investments with original maturities of three months or less.
Short-Term Investments
Short-term investments are carried at fair value and categorized as trading securities as Seaboard has the intent and ability to sell for business needs as they arise. For investments that do not have a readily determinable fair value, Seaboard has elected to use the net asset value (“NAV”) of the investment as a practical expedient to estimate fair value. Changes in the fair value of short-term investments are recorded as unrealized gains and losses included in other income, net in the consolidated statements of comprehensive income, with any purchases and sales recorded on a settlement date basis.
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SEABOARD CORPORATION
Notes to Consolidated Financial Statements
Accounts Receivable
Accounts receivable are recorded at the invoiced amount and generally do not bear interest.
The allowance for credit losses is Seaboard’s best estimate of the amount of probable credit losses using the current expected credit loss model. This model estimates the lifetime of expected credit loss based on historical experience, current conditions and reasonable supportable forecasts. Changes in estimates and other new information can have a material effect on future evaluations. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote.
The activity within the allowance for credit losses was as follows:
Balance at Balance at
Allowance for Credit Losses:
Notes Receivable
Notes receivable are included in other receivables, if current, and other non-current assets, if long-term. Seaboard’s notes receivable balances, net of reserves, were $43 million and $40 million as of December 31, 2025 and 2024, respectively. Seaboard monitors the credit quality of notes receivable, using the current expected credit loss model.
The activity within the allowance for notes receivable was as follows:
Balance at Balance at
Allowance for Notes Receivable:
Inventories
Grain, flour and feed inventories at the CT&M segment’s foreign milling operations are valued at the lower of weighted-average cost and net realizable value (“NRV”). All other inventories are valued at the lower of first-in, first-out (“FIFO”) cost and NRV. In determining NRV, management makes assumptions regarding estimated sales prices, estimated costs to complete and estimated disposal costs. Changes in future market prices or facts and circumstances could result in a material write-down in the value of inventory or decreased future margins on the sale of inventory.
Production tax credits that are transferable replaced the federal blender’s tax credit on January 1, 2025. Analogizing to an international accounting standard, due to the absence of specific U.S. GAAP guidance not yet adopted for such governmental credits, Seaboard elects to recognize these production tax credits in inventories as it intends to sell to third parties, with an offset to cost of sales, when the economic benefit of the credit is deemed probable. The production tax credits are carried at estimated fair value per the U.S. government model, net of a discount upon expected sale. Environmental credits, specifically renewable identification numbers (“RINs”) and Low Carbon Fuel Standard (“LCFS”) credits, are recorded in inventory upon generation and then recognized in revenue from products when sold to third parties. The inventory values of these credits are subject to market price fluctuations and regulatory changes.
Property, Plant and Equipment
Property, plant and equipment are carried at cost and, except for land, depreciated using the straight-line method over an estimated useful life. Property, plant and equipment under finance leases are stated at the present value of minimum lease payments and subsequently amortized using the straight-line method over the earlier of the end of their useful life or the end of the lease term. Routine maintenance, repairs and minor renewals are expensed as incurred, while major renewals and improvements are capitalized.
Property, plant and equipment and other long-lived assets are reviewed for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. Recoverability of assets to be held and used is
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SEABOARD CORPORATION
Notes to Consolidated Financial Statements
measured by comparing the carrying amount of the asset to future undiscounted net cash flows expected to be generated by the asset. Impairment is recognized if the carrying amount of the assets exceeds the estimated fair value of the assets. Due to sustained operating losses, management performed asset impairment tests in 2025 and 2024 of the Liquid Fuels segment’s property, plant and equipment and concluded assets were not impaired.
Right-of-Use Assets and Lease Liabilities
Right-of-use (“ROU”) assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The present value of lease payments is determined primarily using the incremental borrowing rate based on the information available at the lease commencement date. For leases that do not have readily determinable implicit discount rates, Seaboard adjusts its incremental borrowing rate by the local risk-free interest rate on its Term Loan due 2033 with a credit risk premium corresponding to Seaboard’s unreported credit rating. Then Seaboard determines discount rates based on term, country and currency where the leased asset is located. Seaboard accounts for lease and non-lease components as a single lease component for all classes of underlying assets. Seaboard does not recognize ROU assets and lease liabilities for short-term leases with terms greater than one month but less than 12 months.
Goodwill
Goodwill is assessed annually for impairment by each reporting unit during the fourth quarter. Goodwill is assessed more frequently if events or changes in circumstances indicate that impairment is likely. Seaboard first assesses qualitative factors to determine whether it is more likely than not the fair value of any reporting unit is less than its carrying amount. If qualitative factors indicate more likely than not that an impairment is possible, Seaboard performs a quantitative impairment test using discounted cash flow analysis by comparing the fair value of a reporting unit with its carrying amount. An impairment charge is recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value.
The changes in the carrying amount of goodwill were as follows:
Pork CT&M
(Millions of dollars) Segment Segment Total
Foreign currency translation — 4 4
Foreign currency translation — 4 4
Accrued Self-Insurance
Seaboard is self-insured for certain levels of workers’ compensation, health care coverage, property damage, vehicle, product recall and general liability. Liabilities associated with some of these risks are estimated based on actuarially-determined amounts and accrued in part by considering historical claims experience, demographic factors, severity factors and other actuarial assumptions. Changes in estimates to previously recorded reserves are reflected in current operating results.
Asset Retirement Obligation
Seaboard records a long-lived asset and a related liability for the asset retirement obligation costs associated with the closure of all hog lagoons. Based on detailed assessments and appraisals obtained to estimate the future asset retirement obligation costs, Seaboard records the present value of the projected costs in other non-current liabilities in the consolidated balance sheets. The retirement asset is depreciated over the economic life of the related asset. The following table shows the changes in the asset retirement obligation:
December 31,
(Millions of dollars) 2025 2024
Beginning balance $ 36 $ 34
Accretion expense 2 2
Liability for additional lagoons 2 —
Ending balance $ 40 $ 36
Pension Plans
Seaboard records annual income and expense amounts relating to its pension plans based on calculations which include various actuarial assumptions, including discount rates, mortality, assumed rates of return, compensation increases and retirement rates. Seaboard reviews its actuarial assumptions on an annual basis and makes modifications to the assumptions
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SEABOARD CORPORATION
Notes to Consolidated Financial Statements
based on current rates and trends when it is deemed appropriate to do so. The effect of modifications on the value of plan obligations and assets is recognized immediately within other comprehensive income (loss) and amortized into operating earnings over future periods using the corridor approach. Under this approach, actuarial (gains) losses that exceed 10% of the greater of the pension benefit obligation or the fair value of plan assets are generally amortized over the average remaining working lifetime of the participants. The measurement date for all plans is December 31. The service cost component of net periodic benefit cost is recorded in either cost of sales or selling, general and administrative expenses depending upon the employee, and the other components of net periodic benefit cost are recorded in other income, net in the consolidated statements of comprehensive income. Settlements are recognized when lump sum payments on a cumulative basis exceed the service cost plus interest cost for the respective plan.
Revenue Recognition
Almost all of Seaboard’s contracts with its customers are less than one year. Seaboard recognizes revenue when control of the promised products or services is transferred to its customers, in an amount that reflects the consideration it expects to receive in exchange for those products or services. The majority of Seaboard’s revenue arrangements consist of a single performance obligation as the promise to transfer the individual product or service is not separately identifiable from other promises in the contracts, including shipping and handling and customary storage, and, therefore, not distinct. Revenue from products and services transferred to customers at a single point in time accounts for approximately 85% of Seaboard’s net sales. Substantially all of the sales in Seaboard’s Marine segment are recognized ratably over the transit time for each voyage, as the performance obligation to its customers is satisfied.
Seaboard’s transaction prices are mostly fixed, but occasionally include minimal variable consideration for early payment, volume and other similar discounts, which are highly probable based on the history with the respective customers. Taxes assessed by a governmental authority that are collected by Seaboard from a customer are excluded from sales. Seaboard recognizes a financing component only on obligations that extend longer than one year.
Deferred revenue represents cash payments received in advance of Seaboard’s performance or revenue billed that is unearned. The CT&M segment requires certain customers to pay in advance or upon delivery to avoid collection risk. The Marine segment’s deferred revenue balance primarily relates to the unearned portion of billed revenue when a vessel is on the water and has not arrived at the designated port. Deferred revenue balances are reduced when revenue is recognized. The majority of the deferred revenue balance as of year-end is recognized as revenue during the following quarter.
Research and Development
Seaboard conducts research and development activities to develop new products and to improve existing products and processes. Seaboard incurred research and development expenses of $64 million, $113 million and $361 million for the years ended December 31, 2025, 2024 and 2023, respectively. These costs are expensed as incurred.
Other Income, Net
The components of other income, net on the consolidated statements of comprehensive income were as follows:
Years Ended December 31,
Interest and dividend income $ 74 $ 68 $ 62
Investment gains, net 39 19 85
Foreign currency losses, net (14) (9) (4)
Miscellaneous, net 4 (1) 4
Total other income, net $ 103 $ 77 $ 147
Income Taxes
Deferred income taxes are recognized for the tax consequences of temporary differences by applying enacted statutory tax rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. Effects of changes in tax laws, including retroactive changes, are recognized in the financial statements in the period that the changes are enacted.
Each reporting period, Seaboard assesses the realizability of its deferred tax assets and the amount of any valuation allowance for each relevant taxing jurisdiction. A valuation allowance is established if it is more likely than not that the deferred tax assets will not be realized. Realizability of deferred tax assets is based on the weight of available positive and negative evidence to estimate whether sufficient future taxable income will be generated.
Seaboard accounts for the global intangible low-taxed income provision (“GILTI”) and the base-erosion and anti-abuse tax provision taxes in the period incurred. The Organization for Economic Cooperation and Development’s (“OECD”)
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SEABOARD CORPORATION
Notes to Consolidated Financial Statements
Pillar Two Model Rules (“Pillar Two”) are considered an alternative minimum tax, and therefore deferred taxes are not recognized or adjusted for the estimated future effects of the minimum tax.
For quarters, Seaboard computes its year-to-date provision for income taxes by applying the estimated annual effective tax rate to year-to-date pre-tax income or loss and adjusts the provision for discrete tax items recorded in the period. If an annual effective tax rate cannot be reasonably estimated, Seaboard uses the actual effective tax rate.
Earnings Per Common Share
Earnings per common share are based upon the weighted-average shares outstanding during the period. Basic and diluted earnings per share are the same for all periods presented.
Recently Issued Accounting Standards Adopted
For the year ended December 31, 2025, Seaboard adopted Financial Accounting Standards Board (“FASB”) guidance that requires additional detailed income tax disclosures related to standardization and disaggregation of information in the rate reconciliation and income taxes paid by jurisdiction. This accounting standard was applied prospectively to the current annual period, and prior period disclosures were not adjusted. See Note 12 to the consolidated financial statements for expanded disclosures.
Recently Issued Accounting Standards Not Yet Adopted
In December 2025, the FASB issued guidance on the recognition, measurement and presentation of government grants. The standard is effective for interim and annual reporting periods beginning January 1, 2029. Seaboard is assessing the impact this guidance will have on its financial statements, including the accounting for production tax credits. Based on preliminary analysis, Seaboard does not expect significant changes, as the U.S. GAAP model under the new standard is largely aligned with international accounting standards applicable for Seaboard’s facts and circumstances.
In November 2024, the FASB issued guidance which requires disclosure of incremental income statement expense information on an annual and interim basis, primarily through additional expense disclosures including disaggregation of specific expense categories including, but not limited to, purchases of inventory, employee compensation, depreciation, amortization and selling expenses. Prospective application is required, and retrospective application is permitted. Seaboard will adopt this guidance for the annual reporting period beginning on January 1, 2027, and interim periods within the annual year beginning on January 1, 2028. Seaboard is assessing the impact this guidance will have on its disclosures.
Note 2 − Investments
The following is a summary of the fair value of short-term investments classified as trading securities:
December 31,
(Millions of dollars) 2025 2024
Domestic equity securities (a) $ 713 $ 205
Foreign equity securities 145 98
Domestic fixed-income mutual funds 136 —
Foreign fixed-income mutual funds 26 —
Domestic debt securities - other 25 635
Foreign debt securities - other — 102
Money market funds held in trading accounts 7 28
Other trading securities — 7
Total short-term investments $ 1,052 $ 1,075
During the fourth quarter of 2025, Seaboard sold certain domestic and foreign debt securities and re-invested the proceeds into equity funds that hold high-quality, liquid debt securities. See Note 10 to the consolidated financial statements for more information on measuring fair value for the investments.
The unrealized gains (losses) related to trading securities still held at the end of the respective reporting period were ($10) million, $13 million and $39 million for the years ended December 31, 2025, 2024 and 2023, respectively.
Long-term Investments
During 2025, Seaboard invested $50 million in a fund that owns corporate debt securities. Seaboard’s intention is to hold this investment through its wind-down period, with principal distributions expected primarily over the subsequent four to five years. See Note 10 to the consolidated financial statements for more information on measuring fair value. Seaboard’s other long-term investments are primarily in real estate and are accounted for under the equity method of accounting.
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SEABOARD CORPORATION
Notes to Consolidated Financial Statements
Note 3 − Inventories
The following table is a summary of inventories:
December 31,
(Millions of dollars) 2025 2024
At lower of FIFO cost and net realizable value ("NRV"):
Hogs and materials $ 476 $ 471
Pork products and materials 66 66
Grains, oilseeds and other commodities 346 367
Biofuels and related credits 339 221
Other 77 64
Total inventories at lower of FIFO cost and NRV 1,304 1,189
Total inventories $ 1,513 $ 1,408
Production tax credits of $66 million are included in the December 31, 2025 biofuels and related credits inventory balance. These credits are able to be monetized upon a sale to a third party, and there were no production tax credit sales for the year ended December 31, 2025.
Note 4 − Property, Plant and Equipment
The following table is a summary of property, plant and equipment:
Useful December 31,
(Millions of dollars) Lives 2025 2024
Land and improvements 3 - 15 years $ 504 $ 470
Buildings and improvements 25 - 30 years 878 859
Office furniture and fixtures 3 - 10 years 55 50
Contract growers 5 - 15 years 141 155
Construction in progress 124 237
Total property, plant and equipment 5,199 4,722
Accumulated depreciation and amortization (2,379) (2,162)
Net property, plant and equipment $ 2,820 $ 2,560
Seaboard’s capitalized interest on construction in progress was $7 million, $24 million and $17 million for the years ended December 31, 2025, 2024 and 2023 respectively.
Note 5 − Leases
Seaboard leases ports, vessels, contract grower assets, and to a lesser extent, land, buildings and machinery and equipment. Seaboard’s non-lease components are primarily for services related to labor associated with crew services on vessel charter arrangements and caring for hogs in its contract grower agreements.
Seaboard’s operating lease assets and liabilities are reported separately in the consolidated balance sheets. The classifications of Seaboard’s finance leases in the consolidated balance sheets were as follows:
(Millions of dollars) 2025 2024
Finance lease liabilities Other current liabilities 40 29
Non-current finance lease liabilities Other liabilities 54 68
Lease cost is included in various line items in the consolidated statements of comprehensive income or capitalized to inventory. Operating lease cost and short-term lease cost are recognized on a straight-line basis over the lease term. Finance lease cost is recognized based on the effective interest method for the lease liability and straight-line amortization of the ROU asset. Variable lease payments are recognized when the circumstance on which those payments are assessed occurs.
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SEABOARD CORPORATION
Notes to Consolidated Financial Statements
The components of lease cost were as follows for the years ended December 31:
Operating lease cost $ 168 $ 182 $ 190
Finance lease cost:
Amortization of right-of-use assets 40 50 54
Interest on lease liabilities 5 5 6
Variable lease cost (a) 6 6 10
Short-term lease cost (b) 12 7 9
Sublease income (1) — (7)
(b) Short-term leases are primarily for cargo containers and vessels.
Weighted-average lease terms and discount rates were as follows as of December 31, 2025 and 2024:
Operating Leases Finance Leases
Weighted-average remaining term (in years) 5 5 5 6
Weighted-average discount rate 7.11% 6.83% 5.19% 4.37%
Maturities of lease liabilities as of December 31, 2025, were as follows:
Operating Finance
(Millions of dollars) Leases Leases
Thereafter 85 20
Total undiscounted lease payments 466 107
Less: imputed interest 78 13
Total lease liability $ 388 $ 94
The following table includes supplemental cash and non-cash information related to leases. Seaboard reports the amortization of ROU assets and changes in operating lease liabilities in other liabilities, exclusive of debt in the consolidated statements of cash flows.
Years ended December 31,
Operating cash flows from operating leases $ 168 $ 179 $ 193
Operating cash flows from finance leases 5 5 6
Financing cash flows from finance leases 38 49 57
ROU assets obtained in exchange for new lease liabilities:
Finance leases 61 3 5
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SEABOARD CORPORATION
Notes to Consolidated Financial Statements
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,
Other 49 45 5 5 4
Purchases of raw materials or services from related parties included in cost of sales were $78 million, $68 million and $86 million for the years ended December 31, 2025, 2024 and 2023, respectively. 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.
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 Liquid Fuels segment’s renewable diesel operations.
Combined financial information for the Pork segment’s non-consolidated affiliates was as follows: