Largest meat supplier in the U.S. has lost more than $425 million on beef this year, despite near record-high prices

Tyson Foods, America’s largest meat supplier, is planning to close one of its largest beef-processing plants in Nebraska at a time when a cattle shortage in the U.S. squeezes meatpacking companies.
The Lexington, Neb., plant employs roughly 3,000 people and can slaughter almost 5,000 cattle a day, according to industry estimates.
Tyson is the first of the big four meatpacking companies that process 85% of beef in the U.S. to close a major plant during the current cattle supply crunch. Meatpackers including Tyson have been losing hundreds of millions of dollars processing beef because of the lowest amount of cattle on U.S. pastures since the 1950s.
Tyson said earlier this month that its cattle costs for the 2025 fiscal year that ended in September rose by nearly $2 billion, compared with the prior year. The company reported an adjusted loss of $426 million from its beef business for the year.
The plant closure also follows weeks of pressure from the Trump administration to the entire meat industry to find a way to lower beef prices. President Trump said earlier this month that the Justice Department was investigating the meatpacking companies for conspiring to drive up prices.
Low profit margins on raising cattle after the pandemic, severe drought conditions that burned grazing land and other rising costs prompted ranchers to bring more of their animals to slaughter a couple of years ago and shrink their herd sizes. Now, the cattle supply crunch, mixed with solid beef demand from consumers, has driven livestock prices to all-time highs this year, giving ranchers their highest paychecks ever.
Ranchers have been reluctant to expand their herds. Instead, they are using their newfound income to pay down debts and invest in higher quality cattle. Tyson Foods executives said this month that there are regional pockets in the upper Midwest where some ranchers are expanding, but many haven’t.
The Lexington plant is located just off Interstate 80 in Nebraska, squarely in a cattle country hotbed. It sits between several major facilities owned by other beef processors including JBS and Cargill. A new plant, Sustainable Beef in North Platte, Neb., opened earlier this year about 60 miles west of Lexington.
The closure of a plant could hurt beef production, tightening supplies and driving up prices for consumers even more, according to industry analysts. For cattlemen and feedlot operators in Nebraska, the concern is that having one less large buyer of their livestock could hurt the prices they are paid.
Tyson is also moving its Amarillo, Texas, beef plant that can slaughter about 6,000 cattle a day to a single shift, down from two shifts a day.
Source: Wall Street Journal