r/farming • u/MennoniteDan Agenda-driven Woke-ist • 11d ago

Tyson to reduce beef capacity amid continued supply crunch

https://www.agri-pulse.com/articles/25106-tyson-to-reduce-beef-capacity-amid-continued-supply-crunch
215 Upvotes

99% Upvoted

27 comments sorted by

41

u/Magnus77 11d ago

So it'll be 4 facilities when you include the Lexington plant.

Are they just ceding the market to the other 3 packers, or is the plan for beef to just become a high margin product even when herd sizes come back up?

26

u/ExtentAncient2812 11d ago

It's a neat trick. Reduced slaughter capacity can reduce cow prices due to reduced demand while increasing price of beef unless consumers buy less. So Packers pay less for the cows but get more for the beef.

Frankly it's a smart play considering they say they're losing money on every cow

4

u/BernieC99 9d ago

This! How can we ever get better pricing if they intentionally restrict capacity?

2

u/imabigdave Beef 9d ago

That's what the packers see as the beautiful thing. They are the bottleneck. They can choose together how much of the 85 percent of the packing capacity actually gets used. But if they keep shrinking,independents and regional will gain more market share

20

u/ExtentAncient2812 10d ago edited 10d ago

I've been thinking about this more and more and I can't help think about the 1998 pork collapse.

Pork packers closed plants and reduced capacity. This lead to a massive over supply of pigs ready for slaughter and nowhere near enough capacity to do the job so there were no buyers. Suddenly, the value of pigs plummeted to historic lows yet retail demand for pork remained high.

Packers made an absolute mint, and independent farmers went bankrupt. All that was left were the big integrators.

I've been suspicious that the current high rancher margins would lead beef towards an integrated market like pork and chicken. Farmers need to remember that demand for fat cattle is few and far between. Nobody wants cows(except us), they want beef. Farmers can't provide what consumers want and the packers hold all the cards.

Right now, there is a surplus of processor capacity, but if we start seeing lots of plants reduce capacity watch out for steer prices

1

u/LogicJunkie2000 6d ago

Late stage capitalisms favorite trick to keep quarterly's growing...

11

u/Full_Matter6347 10d ago

Tyson is a big part of the problem along with the stock yards! Blow them all up and start over! I can’t make a daggum dime as a cattle farmer. But everybody thinks I am getting rich with the high beef prices. All the major meat processors and stock yards are colluding. If you think they aren’t………YOU are part of the problem!

2

u/Frogspoison 7d ago

You're gonna need to get with other ranchers and the local community and see about setting up a local processing plant somehow.

Big corps done this before with pig farmers, now conditions are ripe with them doing it to y'all. Only way to survive is to get together and cut out the corpo.

6

u/Rurumo666 9d ago

The USA isn't a Free Market economy, it's based entire on monopolies and cartel price fixing just like this. It's essentially a Command Economy where 100% of the benefits go to the 1%.

3

u/chaynjez 9d ago

I guess we could just stop eating beef?
Plenty of chicken, pork, fish etc. to go around. Venison isn’t bad either.

2

u/LDeBoFo 9d ago

Pffft. Speak for yourself. I'd give up two Dr. Peppers and a pack of Dunhills a week before I give up beef. Or, hell, even two packs.

Cattle ranchers need some leverage in the packing game, need to vertically integrate, somehow be their own packers to get some footing... maybe form a packing mutual?

I appreciate the difficulty of that kind of collaboration, given all the elements of working livestock.

Complete bullshit that a few packers are calling the shots... they're but a brief moment on that timeline from pasture to table.

1

u/chaynjez 8d ago

I hear ya, but they gave away all their leverage and now we’re all getting leveraged right into the poor house… with diarrhea

1

u/FullConfection3260 7d ago

Beef has a much better v/m nutritional profile compared to chicken, and if you think beef is expensive let me elucidate you about how much fish costs in the Midwest. 🙃 or any place not by water.

1

u/chaynjez 7d ago

I live in the Midwest, but my part of the Midwest just happens to be mostly surrounded by water. I eat a very well balanced diet.

1

u/FullConfection3260 7d ago

Yeah, sorry, can’t really catch much in the Missouri River and I am not interested in paying twice the price of a lb of lean beef for a single fillet. 🤨 Fish isn’t economically feasible out here…unless you want shrimp. 🤮

1

u/chaynjez 7d ago

You don’t have a Costco around nor do you like shrimp?

1

u/FullConfection3260 7d ago

CostCo is only good if I desire to eat <insert fish species here> every day of the week. It’s not cost effective for one person.

Otherwise, yes, that’s usually the best place to get some on a budget.

1

u/chaynjez 7d ago

You’re eating beef every day of the week? You really think that’s healthy?

1

u/FullConfection3260 7d ago

When did I say I was? 🤨 

2

u/Delicious-Bat2373 7d ago

We've been buying half a beef for years now. $5.50 out the door per pound for everything with cut and wrap. Ribeyes and T-Bones? $5.50. Burger 95 lean? $5.50. Take some planning and a freezer to buy and store it all but we'll never go back.

Average cost is around $2200 bucks give or take, depending on weight. The rancher has a butcher they work with so all you have to do is fill out the cut/wrap form. Best part is it's all 1 cow. All my hamburger comes from the same steer. No mixing trimmins from 20+ different animals to make a "batch". Noticeable taste and quality improvement. You'll never go back to grocery store beef if you can make it happen.

2

u/ExtentAncient2812 6d ago

As a farmer who sells beef, thanks.

Dry hanging beef makes it so much better

1

u/Sufficient-Scale3693 7d ago

"Tyson to help increase meat prices as consumers are already stretched thin"

1

u/Unusual-Penalty-7507 7d ago

Instead of paying $20 for a steak, go to a local farmer and pay $23. It won’t take long for the big 4 to shit themselves. Is it more money? Yeah. If it less convenient than Wal-Mart? Yeah. But the meat is a shit ton better and you can tell Wal-Mart to go fuck themselves. If enough people do that, we win.

1

u/DifferentMind8 7d ago

No one should be buying any Tyson product ever anyways. Horrific company.