Tyson Foods plans to shutter one of the country's biggest beef processing plants in rural Lexington, Nebraska

The Lexington plant could process 5,000 head of cattle
per day. (Tyson photo)

Even with national beef prices at historic highs, Tyson Foods was still losing millions from its massive processing plant in rural Lexington, Nebraska. To stem its losses, Tyson announced  plans to close the facility "at a time when a cattle shortage in the U.S. squeezes meatpacking companies," reports Patrick Thomas of The Wall Street Journal. 

U.S. Sen. Deb Fischer, R-Neb., a member of the Senate Agriculture Committee, "blasted the decision," reports Cindy Gonzalez of the Nebraska Examiner. Fischer told reporters, “As the single largest employer in Lexington, Tyson’s announcement will have a devastating impact on a truly wonderful community, the region and our state." The plant employs nearly 3,000 people, and the small town has roughly 10,300 people.

While Tyson is the biggest of the four meatpacking companies that process 85% of beef in the U.S., it will be the first "to close a major plant during the current cattle supply crunch," Thomas explains. "Meatpackers have been losing hundreds of millions of dollars processing beef because of the lowest amount of cattle on U.S. pastures since the 1950s."

The announcement comes after months of pressure from the Trump administration to lower beef prices for consumers. Thomas writes, "President Trump said earlier this month that the Justice Department was investigating the meatpacking companies for conspiring to drive up prices."

Tyson also announced it is "moving its Amarillo, Texas, beef plant that can slaughter about 6,000 cattle a day to a single shift, down from two shifts a day," Thomas adds. The Nebraska plant could slaughter nearly 5,000 cattle per day. Tyson's plant closure and Texas shift change could further tighten U.S. beef supplies and push grocery store beef prices higher.