Tyson Foods is shutting down or selling three beef facilities due to an ongoing domestic cattle shortage that continues to squeeze profit margins. The company announced it would end operations at its Joslin, Illinois, beef plant and its Eagle Mountain, Utah, case-ready facility. Additionally, Tyson is seeking a buyer for its beef plant in Pasco, Washington.
The consolidation follows a $138 million operating loss in Tyson’s beef unit, as reported in its latest earnings update. Company executives noted that earlier cost-cutting measures, including the closure of a major processing plant in Lexington, Nebraska, last fall that displaced over 3,000 workers, proved insufficient to offset rising costs.
The closures have significant implications for employees, with the Illinois shutdown alone expected to result in roughly 2,500 union job losses, and more than 7,000 employees losing jobs at the Utah plant. Illinois Democrat Senator Tammy Duckworth expressed her support for the affected workers, stating that her office would work with Tyson to ensure they have access to resources that support their return to work.
Tight cattle supplies are expected to persist, making plant consolidations necessary to protect overall processing capacity. To absorb capacity from the affected sites, Tyson plans to shift production across its remaining network, reinstating a second shift at its facility in Amarillo, Texas. The company will anchor its primary beef processing operations in three central U.S. locations: Amarillo, Texas; Holcomb, Kansas; and Dakota City, Nebraska.
The cattle shortage has been driven by lingering economic pressures and climate challenges that have left ranchers hesitant to rebuild herds, resulting in multi-decade lows in U.S. cattle inventories. Supply concerns have been further complicated by a resurgence of the New World screwworm, a flesh-eating pest that has limited live cattle imports from Mexico.
Tyson’s challenges are not unique, with meat processing competitors facing similar pressures across the sector. Global meatpacking rival JBS announced the closure of two facilities and named a new chief executive after posting a $102 million second-quarter net loss attributed to elevated live cattle costs.
