Dive Brief:
- Due to ongoing cattle shortages and higher costs, Tyson Foods has announced the closure or sale of three beef plants.
- The affected facilities include a beef plant in Joslin, Illinois, a case-ready facility in Eagle Mountain, Utah, and a beef plant in Pasco, Washington.
- Tyson will consolidate production at other facilities to accommodate the shift and plans to reopen a second shift at its Amarillo, Texas, plant.
Dive Insight:
The closures come after Tyson reported a $138 million operating loss in its beef segment, prompting the company to streamline its operations.
By consolidating its beef facilities in Dakota City, Nebraska; Holcomb, Kansas; and Amarillo, Texas, Tyson aims to create a more competitive footprint in response to the historic cattle shortages.
The closures will result in layoffs, with approximately 2,500 union workers affected in Joslin, Illinois, and an undisclosed number in Eagle Mountain, Utah.
The challenges in the beef industry, including low cattle herds and supply constraints, have led to price increases and changes in consumer behavior.
Other beef companies, such as JBS, have also restructured their manufacturing networks in response to similar challenges in the industry.