Fitch analysts have taken lowly-rated US food companies off their critical list, in a report which places meat giant Tyson Foods as a frontrunner to regain an investment grade credit rating.

A spate of refinancings has reduced the $14bn the companies were faced with repaying from 2010-14.

Nearly 40% of debt owed by Dean Foods, the dairy group tripped up by higher milk prices, is not due for another six years, following a rejig last month.

"Dean's successful completion of its bank facility amendment eliminates near-term concerns regarding the company's ability to fund significant debt amortization payments," Fitch said.

It added that extra headroom on penalty trigger levels written into debt small print mean America's biggest dairy company should "now have enough room to navigate through the currently difficult fluid milk environment".

Tyson upgrade? 

Debt pressures for other companies had been improved by a better operating performance, with Fitch highlighting recent upgrades to Dole Foods and Del Monte Foods ratings.

"Tyson is experiencing solid performance in beef, pork and chicken," Fitch said.

"Tyson's continued focus on debt reduction� could result in positive rating actions."

Wesley Moultrie, Fitch senior director, said that "default risk even for the lowest-rated companies, such as Smithfield Foods and Dole is no longer an immediate concern".

'Negative implications'

Indeed, the agency singled out Smithfield Foods as, with Tyson, likely to lower its debt level quickly, in relation to earnings before interest, tax, depreciation and amortisation (ebitda). Debt to ebitda is a much-watched metric for debt levels.

"Smithfield will benefit from improved profitability in its hog production segment," Fitch said.

However, it also flagged the hog giant's potential $200m purchase of Maxwell Farms' majority stake in their Butterball turkey joint venture.

"Smithfield's� desire to maintain a high level of liquidity could force the firm to access capital markets in the near term," the ratings agency said.

"Given Smithfield's high leverage, Fitch views any incremental debt as having negative implications for the company's credit profile."