On Friday, Tyson Meats announced news that the Beef Cattle Industry feared was inevitable, given that the US cattle herd is at lowest level since 1951-short cattle supplies are causing Tyson to shut down a major Beef Processing Plant- and adjust the schedule of a second of their plants.
Tyson released a brief statement on Friday that turns the beef processing world on it’s head:
“Tyson Foods today announced network changes designed to right size its beef business and position it for long-term success.
“The company will end operations at its Lexington, Nebraska, beef facility and convert its Amarillo, Texas, beef facility to a single, full-capacity shift. To meet customer demand, production will be increased at other company beef facilities, optimizing volumes across our network.
“Tyson Foods recognizes the impact these decisions have on team members and the communities where we operate. The company is committed to supporting our team members through this transition, including helping them apply for open positions at other facilities and providing relocation benefits.
“With these changes, Tyson Foods is ensuring that it will continue to deliver high-quality, affordable, and nutritious protein for generations to come.”
The Lexington, Nebraska plant has had a daily slaughter capacity of 5,000 and employs about 3,200 workers. It first opened in 1990. Tyson’s Amarillo facility has a daily slaughter capacity of 5,500 head. The Tyson plans could impact as many as 1,700 workers in Amarillo with the elimination of the second shift. For context, the largest beef processing plant in the US by daily processing capacity is the Tyson Foods plant in Holcomb, Kansas, which can process 6,000 head of cattle per day, according to DTN.
National Cattlemen’s Beef Association’s CEO Colin Woodall provided his reaction to the Oklahoma Farm Report- “NCBA is disappointed by the closure of the beef processing facility in Lexington. Similarly, the reduction in operations at the beef processing plant in Amarillo. This raises concerns about the impact on family farmers and ranchers, but it is the unfortunate result of the industry experiencing excess processing capacity in the face of historically low cattle numbers. We are closely monitoring this situation and are working to ensure the beef supply chain continues to function properly.”
The announcement by Tyson reminds those in the cattle business of the shock that rumbled through the industry a little over a decade ago when we also had tight cattle numbers. The Cargill beef processing plant in Plainview, Texas shut down operations on February 1, 2013, due to tight cattle supplies from prolonged drought, and by 2015 Cargill had put the plant up for sale, leaving it permanently shuttered.
U.S. Sen. Deb Fischer issued a statement about the Tyson plans for the Lexington plant, calling the announcement “extremely disappointing.”
“As the single largest employer in Lexington, Tyson’s announcement will have a devastating impact on a truly wonderful community, the region, and our state,” Fischer said. “Nebraskans are nothing if not resilient, and Lexington has a robust workforce. I hope their skill and experience will be sought after by other employers.”
Fischer noted the volatility of the cattle market in recent years.
“Nebraska is the beef state, and we know better than anyone the highs and lows of the cattle market,” she said. “It’s no secret that just a few years ago, packers like Tyson were making windfall profits while the rest of the industry was continuously in the red.”
“As we head into the holiday season, I call on Tyson to do everything in its power to take care of the families affected by this short-sighted decision,” she added.
Tyson has not released a timeline for the closure.
