Tyson Foods is consolidating its US beef operations with a plan to close two plants and sell another.
In a statement yesterday (13 August), the meat giant announced: "Tyson Foods is making strategic changes to its beef operations to position the company for long-term success.
"Tyson Foods will anchor its beef business around three strategically located beef facilities in the central United States: Dakota City, Nebraska; Holcomb, Kansas; and Amarillo, Texas; to create a more competitive footprint amidst one of the most historic cattle shortages the country has ever experienced."
Two plants are earmarked for closure - Tyson Foods' beef facility in Joslin, Illinois, and its case-ready site in Eagle Mountain, Utah.
Meanwhile, the New York-listed meatpacker will sell its beef facility in Pasco, Washington.
Tyson Foods added: "Recent USDA cattle inventory data, which included continued evidence of limited heifer retention, indicates these supply constraints are likely to persist, requiring strategic action."
Capacity from those three sites “will be moved to more strategically located facilities with ample capacity to grow”.
Just Food has asked Tyson Foods to confirm how many jobs are at risk and to clarify how many beef plants it will have left in the US post the consolidation exercise.
The company said in the statement that it remains “committed” to supporting the affected workers during the transition, including by helping them apply for open roles at other plants.
Amid the restructuring, Tyson Foods will restore a second shift at its Amarillo, Texas, plant as more cattle become available.
“Collectively, these changes will allow the company to maintain a similar level of cattle harvesting across a more efficient and modern network,” it said.
The move to bring back the second shift at Amarillo follows Tyson Foods' November announcement to scale back the site to a single shift under its plan to “right size” its beef business.
At the time, the company also revealed the closure of its beef-processing plant in Lexington, Nebraska.
Tyson Foods’ beef business has gone deeper into the red amid the ongoing cattle shortages.
Earlier in August, the company reported a third-quarter operating loss of $142m for beef versus a loss of $459m in the corresponding period a year earlier. Year-to-date losses were little changed at $701m, compared to a $707m loss.
On an adjusted basis, operating losses in beef widened to $138m from $116m and over the nine months to $483m from $223m.
The operating margin was a negative 2.6%, improving from negative 8.2% a year earlier. For the year so far, the margin was -4.3% versus -4.4% the year previous.
In adjusted terms, the third-quarter margin was -2.6% versus -2.1% a year earlier. It was -2.9% year-to-date compared to -1.4% in the corresponding period.
In February, when Tyson Foods issued its first-quarter results, its president and CEO Donnie King said cattle supplies are likely to remain “tight” through 2026 and into next year.
