Tyson Foods is closing two major facilities and pursuing the sale of a third amid historic cattle shortages. The meatpacking giant announced structural changes to its beef business, citing tight cattle supplies and limited heifer retention that have left consumers facing elevated prices and operations struggling with higher costs.
Tyson Foods is pulling back further from the beleaguered beef sector by shuttering major processing and packaging plants and putting another facility on the market.
Alongside the Joslin closure, the company will end operations at its case-ready packaging facility in Eagle Mountain, Utah, and pursue a sale for its beef plant located in Pasco, Washington, which slaughters about 2,000 cattle a day. Tyson also said it was planning to close a large beef-packaging facility in Utah.
Historic Cattle Shortages and Limited Heifer Retention Drive Corporate Retreat
The restructuring comes in response to one of the most historic cattle shortages the United States has ever experienced, driven by years of drought that reduced forage areas in key ranching regions and forced ranchers to liquidate herds.
Recent USDA cattle inventory data, which included continued evidence of limited heifer retention, indicates these supply constraints are likely to persist, requiring strategic action, the company said in a news release.
The pressures have weighed heavily on the company’s financial performance. During a recent earnings call addressing the downturn, CEO Donnie King addressed the market reality directly:
“Beef hasn’t performed the way we expected, and we’re not pretending otherwise.”
Donnie King, CEO, Tyson Foods
Consolidating Operations Around Central Hubs in Nebraska, Kansas, and Texas
To navigate the prolonged supply squeeze, Tyson will anchor its remaining beef operations around three strategically located facilities in the central United States: Dakota City, Nebraska; Holcomb, Kansas; and Amarillo, Texas. The company stated that these shifts are designed to create a more competitive operational footprint.
Capacity from the closing Illinois and Utah facilities will be redirected to existing Tyson locations that possess ample capacity to grow,
allowing the firm to maintain a consistent level of cattle harvesting across a leaner, more modern network. As regional supply allows, the company also plans to ramp a second shift back up at its Amarillo, Texas, plant.
Worker Impact and Corporate Transition Timeline
Tyson officials emphasized that The company is committed to supporting our team members through this transition, including helping them apply for open positions at other facilities.