Tyson Foods’ Nebraska Beef Plant Closure: Implications for Ranchers Across the Country
Tyson Foods’ recent decision to close a beef plant in Lexington, Nebraska, is poised to have a devastating impact on the small city and could undermine the profits of ranchers across the nation. This facility, which employs nearly one-third of Lexington’s 11,000 residents, plays a crucial role in the local economy.
While the closure of a single slaughterhouse might seem minor, the Lexington plant employs approximately 3,200 people and has the capacity to process around 5,000 head of cattle daily. In addition, Tyson plans to cut one of the two shifts at its Amarillo, Texas plant, resulting in the loss of 1,700 jobs there. Together, these actions will reduce beef processing capacity nationwide by an estimated 7-9%.
Consumers may not notice immediate price changes at the grocery store over the next six months, as the cattle currently prepared for slaughter will still be processed, albeit at different facilities. However, in the long term, beef prices could continue to rise beyond the current record highs. This increase is driven by various factors, including drought and tariffs, unless American ranchers are incentivized to raise more cattle.
Moreover, an increase in beef imports from Brazil, encouraged by President Donald Trump’s recent decision to slash tariffs on Brazilian beef, may provide some relief to consumers while ranchers and feedlots grapple with high costs and declining prices.
A ‘gut punch’ to the community
Clay Patton, vice president of the Lexington-area Chamber of Commerce, described Tyson’s announcement as a “gut punch” to the community in the Platte River Valley, which is integral to the agricultural production chain. The Lexington plant, which opened in 1990, revitalized the town by attracting thousands of immigrants and nearly doubling its population.
With the plant’s closure set for January, the repercussions will be felt throughout the community, jeopardizing many first-generation business owners and investments in new housing. Tyson has offered Lexington workers the option to relocate to other plants, but this requires uprooting families for jobs hundreds of miles away.
“I’m hopeful that we can come through this and we’ll actually become better on the other side of it,” Patton stated.
Elmer Armijo, who moved to Lexington last summer to lead First United Methodist Church, noted the community’s established job security, good schools, and healthcare systems are now in jeopardy. “People are completely worried,” he said. “The economy in Lexington is based in Tyson.” Local churches, including Armijo’s, are already providing counseling, food pantries, and gas vouchers to support community members.
Cattle prices falling in response
The loss of a major buyer for cattle, combined with increasing imports from Brazil—which already accounted for 24% of beef imports this year—adds to the uncertainty surrounding the profitability of the U.S. cattle industry. Bill Bullard, president of Ranchers-Cattlemen Action Legal Fund United Stockgrowers of America, remarked, “There’s a lack of confidence in the industry right now. Producers are unwilling to make the investment to rebuild.”
While boosting imports from Brazil could significantly impact the market, it is unlikely to affect steak prices, as most imports consist of lean trimmings used in ground beef. Kansas State University agricultural economist Glynn Tonsor noted that predicting whether imports will continue to make up roughly 20% of the U.S. beef supply next year is challenging, given the fluctuating nature of tariffs.
Despite soaring prices, American consumers continue to purchase beef, with an average consumption of 59 pounds (27 kilograms) per person this year.
Tyson faces continued losses in the beef business
The meat industry has long experienced excess capacity, with slaughterhouses able to handle more cattle than they process. This situation has worsened as the government encourages smaller companies to enter the market, competing with giants like Tyson.
Tyson anticipates losses exceeding $600 million in beef production this year, following $720 million in losses over the past two years. Tonsor indicated that the closure of at least one beef plant was inevitable, allowing Tyson’s remaining facilities to operate more efficiently at closer to full capacity.
Ernie Goss, an economist at Creighton University, suggested that the Lexington plant likely fell short in an industry increasingly reliant on technological advancements to enhance productivity. “It’s very difficult to renovate or make the old plant fit the new world,” he explained, noting that the facility “just wasn’t competitive right now in today’s environment in terms of output per worker.”
Copyright 2025 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Tyson Foods’ recent decision to close a beef plant in Lexington, Nebraska, is poised to have a devastating impact on the small city and could undermine the profits of ranchers across the nation. This facility, which employs nearly one-third of Lexington’s 11,000 residents, plays a crucial role in the local economy.
While the closure of a single slaughterhouse might seem minor, the Lexington plant employs approximately 3,200 people and has the capacity to process around 5,000 head of cattle daily. In addition, Tyson plans to cut one of the two shifts at its Amarillo, Texas plant, resulting in the loss of 1,700 jobs there. Together, these actions will reduce beef processing capacity nationwide by an estimated 7-9%.
Consumers may not notice immediate price changes at the grocery store over the next six months, as the cattle currently prepared for slaughter will still be processed, albeit at different facilities. However, in the long term, beef prices could continue to rise beyond the current record highs. This increase is driven by various factors, including drought and tariffs, unless American ranchers are incentivized to raise more cattle.
Moreover, an increase in beef imports from Brazil, encouraged by President Donald Trump’s recent decision to slash tariffs on Brazilian beef, may provide some relief to consumers while ranchers and feedlots grapple with high costs and declining prices.
A ‘gut punch’ to the community
Clay Patton, vice president of the Lexington-area Chamber of Commerce, described Tyson’s announcement as a “gut punch” to the community in the Platte River Valley, which is integral to the agricultural production chain. The Lexington plant, which opened in 1990, revitalized the town by attracting thousands of immigrants and nearly doubling its population.
With the plant’s closure set for January, the repercussions will be felt throughout the community, jeopardizing many first-generation business owners and investments in new housing. Tyson has offered Lexington workers the option to relocate to other plants, but this requires uprooting families for jobs hundreds of miles away.
“I’m hopeful that we can come through this and we’ll actually become better on the other side of it,” Patton stated.
Elmer Armijo, who moved to Lexington last summer to lead First United Methodist Church, noted the community’s established job security, good schools, and healthcare systems are now in jeopardy. “People are completely worried,” he said. “The economy in Lexington is based in Tyson.” Local churches, including Armijo’s, are already providing counseling, food pantries, and gas vouchers to support community members.
Cattle prices falling in response
The loss of a major buyer for cattle, combined with increasing imports from Brazil—which already accounted for 24% of beef imports this year—adds to the uncertainty surrounding the profitability of the U.S. cattle industry. Bill Bullard, president of Ranchers-Cattlemen Action Legal Fund United Stockgrowers of America, remarked, “There’s a lack of confidence in the industry right now. Producers are unwilling to make the investment to rebuild.”
While boosting imports from Brazil could significantly impact the market, it is unlikely to affect steak prices, as most imports consist of lean trimmings used in ground beef. Kansas State University agricultural economist Glynn Tonsor noted that predicting whether imports will continue to make up roughly 20% of the U.S. beef supply next year is challenging, given the fluctuating nature of tariffs.
Despite soaring prices, American consumers continue to purchase beef, with an average consumption of 59 pounds (27 kilograms) per person this year.
Tyson faces continued losses in the beef business
The meat industry has long experienced excess capacity, with slaughterhouses able to handle more cattle than they process. This situation has worsened as the government encourages smaller companies to enter the market, competing with giants like Tyson.
Tyson anticipates losses exceeding $600 million in beef production this year, following $720 million in losses over the past two years. Tonsor indicated that the closure of at least one beef plant was inevitable, allowing Tyson’s remaining facilities to operate more efficiently at closer to full capacity.
Ernie Goss, an economist at Creighton University, suggested that the Lexington plant likely fell short in an industry increasingly reliant on technological advancements to enhance productivity. “It’s very difficult to renovate or make the old plant fit the new world,” he explained, noting that the facility “just wasn’t competitive right now in today’s environment in terms of output per worker.”
Copyright 2025 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
