The last several years have brought some segments of the U.S. beef industry positive economic times and other segments have seen negative times, mostly due to the lowest U.S. cattle numbers in 75 years. It all depends on which part of the industry you’re in.
These low numbers are mostly caused by drought, higher prices for all classes of cattle, higher input prices for producers and a cattle cycle that’s went bonkers.
Producers are finally receiving what their cattle are worth. Cattle feeders are kind of hit or miss, depending if they can find cattle to fill up their pens. Meatpackers are making a little but also going in the hole a lot depending if they can keep all shifts busy.
It is packinghouses now making big news, as more are closing down. Across the nation, these shutdowns are taking place with packers paying premium prices for fat cattle while having to shut down shifts because of the low numbers of cattle.
A Nov. 24 CattleFax article stated, “Leverage is expected to shift more in favor of the packer as a result of these plants closing. However, it is important to note the U.S. beef industry will still be operating with excess slaughter capacity in 2026 regardless of plant closures. This is not positive for all packinghouses.”
Across the nation last week, there were 585,000 head of cattle processed, down from last year’s numbers at 635,000, which is 50,000 head of cattle a week – a huge number.
While some of the cattle processed were from Canada, last year at this time there were cattle from both Canada and Mexico being processed.
The big news this week is the Tyson packinghouse in Lexington, Neb. closing down. The packinghouse has operated over 30 years, employs over 3,200 people and processes around 5,000 fat cattle a day. This packinghouse is one of the largest of the 11 Tyson has nationwide.
According to the latest U.S. Security and Exchange Commission report, “Tyson Foods reported an operating loss for the beef division of $1.13 billion for the fiscal year ending on Sept. 27, with adjusted operating losses of $426 million, according to company reports.”
Tyson has also reported the cost of buying cattle was up $1.57 billion compared to a year ago.
In a Nov. 10 news release, Tyson said, “The U.S. Department of Agriculture stated U.S. beef production will decrease around two percent in 2026 compared to year 2025. This would place Tyson’s operating loss for an estimated loss of between $400 and $600 million in the 2026 fiscal year.”
Tyson is also reducing its Amarillo, Texas packinghouse to a single full-capacity shift, and it will increase production at other packinghouses around the nation.
On a positive note, a nearly $300 million packinghouse is operating near North Platte, Neb., owned by ranchers, feedlot owners and others, with Walmart having a minority stake.
Cattle producers and cattle feeders need packinghouses to process their cattle. The big four packinghouses which process some 84 percent of the cattle in the U.S. have not always been the best friend of ranchers and feeders. We can only hope this will change.
Dennis Sun is the publisher of the Wyoming Livestock Roundup, a weekly agriculture newspaper available online and in print.
