Global Meat Giant Suddenly Shuts Down Plants

Recently, an announcement from global meat giant Tyson Foods has sent shockwaves through the global beef industry. The company, with annual sales exceeding $54 billion, declared it will permanently shut down its core beef processing plant in Lexington, Nebraska, while reducing capacity at another facility in Texas—directly cutting U.S. beef processing capacity by 7% to 9%.

Tyson's announcement contained no frills, only harsh realities: the Lexington plant, which processes 5,000 cattle per day (accounting for 4.8% of U.S. daily slaughter volume), has become a "burden" dragging down earnings. Its 2025 fiscal year results showed the beef segment recorded an operating loss of $426 million, making it the company's only unprofitable business unit. Worse, the loss forecast for fiscal 2026 has widened to $400 million to $600 million.

Tyson's predicament epitomizes a systemic crisis plaguing the U.S. beef industry—a crisis that has long spread from upstream ranches to downstream retail, creating an intractable vicious cycle.

Prolonged drought in major cattle-producing states like California and Texas has caused forage production to plummet by 40%. Ranchers have been forced to transport hay from thousands of miles away, with shipping costs even exceeding the value of the feed itself.

U.S. tariffs of 50% on beef imports from Brazil and Australia led to a 68% nosedive in beef imports in the first half of 2025. Concurrently, a 30% tariff on Argentine soybean meal has increased feed costs by $45 per head of cattle. What was intended as "trade protection" has backfired into "self-sabotage," further exacerbating supply shortages.