The price of beef rose 16.4 percent in 2025. It isn’t likely to get any cheaper this year or next, according to recent earnings reports and Agriculture Department data.
Tyson Foods, which controls about 20 percent of the country’s meat market, said it expects to lose $250 million to $500 million in its beef business during its fiscal year, which ends in September.
The primary cause of the company’s struggle is the United States cattle supply, which has reached its lowest level in 75 years. With fewer cattle at feedlots, beef processors must pay higher prices to obtain them. Live cattle contracts were trading for $2.41 per pound Tuesday, up from $2.03 a year ago and $1.16 five years ago.
Tyson said it lost $319 million in its beef business during the last three months of 2025. All of its other meat businesses, such as poultry and pork, were profitable. Overall, sales in the quarter rose 5.1 percent to $14.3 billion, compared to the same quarter a year ago.
It’s the company’s first earnings report since Tyson announced it would shutter one of its largest beef processing plants, in Nebraska, as it continues to struggle with the high cost of cattle.
“Continuing to absorb losses like we have been seeing for the past two years is simply unacceptable,” Donnie King, the chief executive of Tyson, said about beef on an earnings call Monday. The company’s chief operating officer called the beef industry “very dynamic and volatile.”
Every company that produces beef is struggling. JBS, one of Tyson’s biggest competitors, reported a $46 million loss in its North American beef business in the quarter ending last October.
While meat processors have raised prices to keep up with strong consumer demand, leading to record sales, they cannot raise prices enough to reach profitability. “If you’re a highly specialized producer with very niche products, you’ll have more pricing power, but in the standard beef markets, you have to take whatever the market is giving,” Heather Jones, an agriculture industry analyst, said in an email.
The Agriculture Department released its semiannual cattle report last week, which showed that the United States cattle herd shrank slightly in 2025, to 86.2 million from 86.5 million in January 2025. The supply of beef cows is down 1 percent, and the number of cattle and calves on feedlots decreased 3 percent.
Historically, the size of the cattle herd is cyclical. When cattle are sold for high prices, some ranchers hold back heifers — sacrificing short-term profit — to breed more cattle and take advantage of those prices over a few years. Eventually, this leads to an oversupply of cattle and a drop in prices, prompting producers reduce the size of their herd.
There are small signs that ranchers are beginning to grow their herds. The amount of beef heifers has increased 1 percent since last year. But that is not enough to fully rebuild the beef cattle herd, and paradoxically, rebuilding herds will only make things more expensive in the short term, as it pulls cattle from slaughter for breeding.
“We expect cattle supplies to remain tight throughout 2026 and 2027,” said Mr. King on the earnings call.
Unable to control the cost of cattle, meat processors are trying to tamp down their internal costs and operate more efficiently. Tyson, besides closing the Nebraska plant, is reducing shifts at a Texas plant. JBS is shutting down a California facility that processes beef for grocery stores.
More beef is also arriving from other countries. Through November, the United States imported 17 percent more beef products in 2025 compared with 2024, according to Agriculture Department data, and in 2024 it imported 24 percent more than in 2023. Processors and wholesalers are searching for beef anywhere they can find it, but even the increased imports have been unable to dampen domestic prices.
Kevin Draper is a business correspondent covering the agriculture industry. He can be reached at [email protected] or [email protected].
The post Meat Processors Take a Hit as Cattle Prices Remain High appeared first on New York Times.
