Tyson Foods to close 2 facilities, pursue sale of another amid 'historic' cattle shortage
The company will end operations at facilities in Illinois and Utah
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Tyson Foods announced Thursday that it will close two facilities and is pursuing the sale of a third as it makes "strategic changes" to its beef business.
The company will end operations at its Joslin, Illinois, beef plant and its Eagle Mountain, Utah, case-ready facility, while pursuing a sale of its Pasco, Washington, beef facility, according to a Tyson Foods news release.
"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," the meatpacking giant said.
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Beef cattle gather in a pasture. Tyson pointed to recent data showing continued limited heifer retention, a sign that tight cattle supplies could persist. (Angela Piazza/The Dallas Morning News, File)
Tyson pointed to recent data showing continued limited heifer retention, a sign that tight cattle supplies could persist.
"Recent USDA cattle inventory data, which included continued evidence of limited heifer retention, indicates these supply constraints are likely to persist, requiring strategic action," the company said.
Capacity from the Illinois and Utah facilities will be shifted to other Tyson locations that the company said have "ample capacity to grow."
Tyson also plans to ramp a second shift back up at its Amarillo, Texas, plant as more cattle become available.
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Capacity from the Illinois and Utah facilities will be shifted to other Tyson locations that the company said have "ample capacity to grow." (Cheng Xin/Getty Images)
"These changes will allow the company to maintain a similar level of cattle harvesting across a more efficient and modern network," the news release states.
The company also said it will support employees affected by the closures.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| TSN | TYSON FOODS INC. | 56.39 | +0.58 | +1.04% |
"The company is committed to supporting our team members through this transition, including helping them apply for open positions at other facilities," Tyson said.
The changes come as American consumers continue to face elevated beef prices and meatpackers grapple with tight cattle supplies and higher costs.
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Tyson Foods packaged steak strips are displayed at a store in Washington, D.C., on Nov. 19, 2012. Tyson also plans to ramp a second shift back up at its Amarillo, Texas, plant as more cattle become available. (Andrew Harrer/Bloomberg via Getty Images)
The U.S. cattle herd has fallen to historically low levels due to drought reducing forage areas in key ranching regions, which forced ranchers to liquidate cattle.
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Tyson highlighted those pressures during its recent earnings call, with CEO Donnie King saying, "Beef hasn't performed the way we expected, and we're not pretending otherwise."
FOX Business' Eric Revell contributed to this report.