Tyson Foods is reducing production capacity amid a livestock shortage in the USA

The company announced the cessation of operations at the Josselyn, Illinois site and the ready-to-sell beef production facility in Eagle Mountain, Utah. Furthermore, the plant in Pasco, Washington, has been put up for sale. These measures are aimed at optimizing operations amidst high raw material costs and financial losses. Production processes will be relocated to other sites, which management expects will maintain overall livestock slaughter volumes.

The industry is facing the consequences of a multi-year decline in herd sizes, which have reached their lowest levels in decades. One of the reasons has been droughts in the western United States, which made livestock maintenance difficult, as well as the reluctance of farmers to increase livestock numbers due to challenging economic conditions. The situation was further complicated by restrictions on livestock imports from Mexico due to the detection of a parasite — the New World screwworm. Although trade is gradually resuming, Tyson notes that it takes a significant amount of time to fatten imported livestock, so the supply shortage will persist in the long term.

Rising prices for cattle for processors have led to an increase in the retail cost of meat for consumers. According to USDA projections, the price of a slaughter steer in 2026 will be approximately $251.10 per hundredweight. Retail prices for lean and extra-lean ground beef reached $8.65 per pound in June. Tyson projects that its beef processing segment may incur an adjusted operating loss of $500 to $650 million in the 2026 fiscal year.

Earlier this year, Tyson Foods already closed a large plant in Lexington, Nebraska, which employed about 3,200 people, and consolidated production in Amarillo, Texas. The current closures will affect thousands of jobs: approximately 2,500 jobs are slated for elimination in Josselyn and about 700 in Eagle Mountain. Going forward, the company plans to focus its capacity on three key facilities in Dakota City (Nebraska), Holcomb (Kansas), and Amarillo (Texas).