The declining supply of cattle in the U.S. has caught up to beef processors heading into the last weeks of 2024. Two major processors announced major cuts in their workforce in recent days.
Tyson Foods announced Dec. 4 it is closing three U.S. plants affecting more than 1,000 employees, biggest among them being the Emporia, Kansas, facility with 809 workers. Two other prepared food facilities in Philadelphia that produce frozen cheesesteaks are also closing, according to Department of Labor filings and reporting from Agriculture Dive.
Cargill will also lay off 5% of its entire workforce – a move that will cut nearly 8,000 workers globally. The company has seen a 10% drop in annual revenue in 2024, leading to consolidation plans that include several divisions, including its meat processing.
Agriculture Dive reported that since February, Cargill has already closed jobs at its Nashville beef plant and California beef processing facility.
The whole picture is magnified significantly by beef cattle inventory declining to its lowest number since the early 1960s, with no expansion planned for the coming year.
Another challenge to the supply of cattle going into the processing segment is the shutdown of all Mexican live cattle imports due to New World screwworm detection. The estimate of three to four weeks until the issue can be clarified would be short term.
But a new Trump administration and its plan for tariffs, tighter border control and deportations of foreign-born residents in the U.S. could hit beef production plants hard in the new year.
In a Bloomberg story published [very recently], several additional factors to the supply shortage and reduced female retention bode ill for the industry in the coming year, with President-elect Trump aiming for tariffs and immigration reform.
“All of the things he is talking about have potential negative consequences more so than anything positive,” Derrell Peel, a professor of agricultural economics at Oklahoma State University, said of Trump’s policy pledges. “Our fate’s pretty well determined in the cattle industry in the U.S. for the next two to four years – and it’s not good.”
Read the Bloomberg story here.
