Chicken Pays Tyson’s Bills After a Second Beef Warning

Tyson Foods on Sept. 3 cut fiscal 2026 adjusted operating income to $1.85 billion to $2.05 billion and trimmed sales growth to 1.5% to 2.0%, the second company-wide cut in 31 days, as beef losses widened in the year’s last quarter. At the low end of that band, the chicken unit’s own target is $1.85 billion to $1.95 billion, which means poultry now matches the whole firm if beef stays as bad as Springdale now fears.

President and CEO Donnie King still pointed to a diversified protein mix and to plant cuts announced in August. The same statement said lower cattle prices would hit the value of live cattle the company already holds, after Washington opened a 90-day door for cheaper imported lean trim.

Chicken Matches the Whole Company at the Low End

The Springdale, Arkansas, company, which had about 133,000 team members as of Sept. 27, 2025, updated its fiscal 2026 outlook for a 53-week year on a comparable 52-week base. On Aug. 3 it had still aimed for $2.1 billion to $2.3 billion of adjusted operating income and for sales growth of 2.5% to 3.5%. Both ends of the profit band moved down by $250 million.

Beef is where the year broke. Tyson now sees an adjusted operating loss of $625 million to $775 million in that segment, $125 million worse at both ends than the $500 million to $650 million hole it flagged with third-quarter results. Chicken was narrowed too, from $1.90 billion to $2.05 billion on Aug. 3 to $1.85 billion to $1.95 billion. Pork is now $200 million to $250 million. Prepared Foods stays at $1.3 billion to $1.35 billion, and International stays at $150 million to $200 million.

FISCAL 2026 ADJUSTED OPERATING INCOME

Through nine months, beef had already lost $483 million on an adjusted basis, including a $138 million loss in the third quarter, while chicken had earned $1,470 million. Hillshire Farm, Jimmy Dean, and the rest of Prepared Foods are still the other engine King can point to. Pork, he said, is being squeezed because hog supplies rose and wholesale prices fell faster than livestock costs. Foodservice customers are cautious on discretionary spending. The mix he calls a hedge is doing what a hedge does, until beef’s hole is large enough to rewrite the total.

Shares fell about 7% on Sept. 3. Freddy Lavric, a portfolio manager at Winthrop Capital Management who holds the stock, said the cut shows how hard the cattle cycle still is for Tyson and for the rest of the beef industry.

The Inventory Write-Down Washington Helped Trigger

Tyson’s own words put two pressures in the same sentence: “significant margin compression amid volatile cattle prices and one of the most severe cattle shortages in U.S. history,” plus “the expected impact of lower cattle prices on the value of live cattle inventories.” A packer wants cheaper cattle at the plant gate. A packer that already bought animals, and still has them on the books, takes a hit when those prices fall.

That second hit arrived after President Donald Trump moved to talk cattle prices down. King did not mention the White House in the Sept. 3 release. He did not need to. Live inventory is marked to a market that sold off when traders heard that more lean trim would enter at the in-quota duty.

Margin compression is the older problem. Too few cattle chase too much plant space, so packers bid up the animals they can find and then sell boxed beef into a retail market already at records. Closing plants is how Tyson says it will match that smaller run. Writing down the cattle it already owns is how a policy built to cheapen ground beef lands on its fourth-quarter P&L before those plant savings show up.

King put the plant cuts and the new profit number in the same breath. “The Beef pressures that have intensified this quarter reflect industry-wide cattle-cycle dynamics that required decisive action,” he said. “We expect these actions to begin reducing operating cost pressures as we enter fiscal 2027.” Fiscal 2027 is the point. Fiscal 2026 is the year he just cut, with only weeks of it left.

USDA’s July Count Still Shows Fewer Beef Cows

The Department of Agriculture’s National Agricultural Statistics Service, in its July 24 Cattle report, put all cattle and calves on July 1 at 94.2 million head of cattle and calves, a tick above 94.0 million a year earlier and the first July rise since 2018. The breeding core did not join that bounce. Beef cows stood at 28.45 million head, down 200,000, or 1%, from 28.65 million. Milk cows rose 2% to 9.65 million, which is why the headline herd could rise while the beef herd could not.

THE JULY 1 CATTLE COUNT

• All cattle: 94.2 million head, up from 94.0 million a year earlier.
• Beef cows: 28.45 million head, down 1% from 28.65 million.
• Beef replacement heifers: 3.80 million head, up 3% from 3.70 million.
• Calf crop: 32.5 million head, down 2% from a year earlier.

Replacement heifers at 3.80 million head, up 3%, are the first retention signal in years, and it is a small one. The 2026 calf crop is expected at 32.5 million head, down 2%. Cattle on feed for slaughter totaled 13.2 million head, up 2%, a feedlot backlog that stretches days on feed and carcass weights without putting more cows in pastures. Derrell Peel, livestock marketing specialist at Oklahoma State University, said the figures show an attempt to stabilize, not a rebuild you can start the clock on.

The White House, in the Aug. 26 proclamation, said the national herd has fallen to its lowest level in 75 years and that USDA forecasts beef output to fall about 4% from 2025. It also cited drought and wildfire across cattle country, plus live-animal import limits from Mexico while USDA works through a phased reopening of southern ports after New World screwworm. Heifers kept back for breeding do not become hamburger this year. That is the math Tyson is living inside, and it does not turn in a quarter.

Joslin Closed Before Midwest Feeders Could Reroute

On Aug. 13, 21 days before the latest cut, Tyson said it would anchor its beef business around three plants in Dakota City, Nebraska; Holcomb, Kansas; and Amarillo, Texas. It ended harvest at Joslin, Illinois, that day and processing the next, closed the case-ready plant in Eagle Mountain, Utah, and put the Pasco, Washington, beef plant up for sale. Capacity, it said, would move to sites with room to grow, and a second shift at Amarillo would return “as cattle become available,” so slaughter tons would stay similar on a smaller map.

Joslin employed about 2,500 people and harvested about 3,000 head a day, mostly Illinois and Iowa cattle. Workers were told harvest jobs would end on or around Aug. 13 and processing on or around Aug. 14, with pay running through Oct. 12, 2026. Eagle Mountain, a roughly $300 million case-ready plant that opened in 2021, will drop 723 jobs under a notice filed with the Utah Department of Workforce Services, also with an Oct. 12 end date. The two closings alone touch 3,223 jobs. Pasco, which Tyson bought in 2001, can kill about 2,000 head a day and still handles most of the Northwest’s fed cattle; Jack Field of the Washington Cattle Feeders Association said a sale beats a shutdown and still leaves feeders asking who the buyer is, because the next plants sit about eight hours away by truck.

THE BEEF NETWORK TYSON IS KEEPING AND CUTTING

• Joslin, Illinois: Closed; about 2,500 jobs and about 3,000 head a day.
• Eagle Mountain, Utah: Closing; 723 jobs at a case-ready plant opened in 2021.
• Pasco, Washington: For sale; about 2,000 head a day, the Northwest’s main fed-cattle outlet.
• Dakota City, Holcomb, Amarillo: The three plants Tyson will run as the core, with Amarillo’s second shift waiting on cattle.

Tyson had already closed its large Lexington, Nebraska, beef plant earlier in the year and had cut Amarillo back to one shift. Analysts at Stephens Inc. put the August actions at $100 million to $150 million of annual savings, which is why King can say costs ease in fiscal 2027 and still have to cut 2026. Illinois feeders who used Joslin now face hauls of 160 to 400 miles. Rita Newton, an 11-year Joslin worker, said the plant closed without notice to the union. Laid-off workers there have been rallying for state officials to step in. Sid Miller, Texas agriculture commissioner, said the shortage is now moving through the whole beef chain.

THE MONTH THE OUTLOOK BROKE

1. August 3, 2026: Third-quarter results hold company profit at $2.1 billion to $2.3 billion and set the beef loss at $500 million to $650 million.
2. August 13, 2026: Joslin and Eagle Mountain come out of the network; Pasco goes up for sale.
3. August 21, 2026: Trump says up to 300,000 metric tons of ground-beef product will enter with no out-of-quota tariff for 90 days.
4. August 26, 2026: The proclamation is signed, limited to lean beef trimmings in three tranches.
5. September 1, 2026: The first 100,000 metric ton tranche opens.
6. September 3, 2026: Tyson cuts company profit and widens the beef loss, citing lower cattle prices on live inventories.

A viral clip of the plant cuts even had the Illinois town wrong, calling Joslin “Joplin,” which is how far the shutdown traveled from the people who worked the chain.

Lean Beef Trimmings Enter in Three Tranches

The Aug. 26 proclamation, titled Further Ensuring Affordable Beef for the American Consumer, raises the in-quota quantity by 300,000 metric tons of lean beef trimmings for calendar 2026. The extra volume is only those trimmings, the lean product grinders blend with fatter domestic beef, and it is allocated to “other countries or areas” on a first-come basis. The first 100,000 metric tons opened Sept. 1 and runs through Sept. 30. The second opens Oct. 1. The third opens Oct. 31 and lasts until the extra quota fills or Nov. 30, whichever comes first.

It sits on top of Proclamation 11010 of Feb. 6, which already added 80,000 metric tons of lean trimmings from Argentina. USDA and the trade representative are told to watch whether the new tons sell at 25% below the market price for those trimmings. If they do not, Trump wrote, he may shut the extra quota to block a windfall for foreign producers.

The product is trim, not steaks, and 90 days is not a calving season. A heifer kept in 2026 throws a calf in 2027 that is not boxed beef until 2028 or 2029. Ken Foster and Bernhard Dalheimer at Purdue’s Center for Commercial Agriculture called the waiver a narrow tool aimed at a narrow problem, and noted that 300,000 metric tons is a ceiling, not a promise of 300,000 extra tons, because some of it can be beef that would have entered anyway. For Tyson, the near-term effect is the one it already booked: cattle prices moved, and live inventories moved with them, before a single cheaper burger shows up as a full-year earnings save.

Colin Woodall Warns the Rebuild Just Lost Its Signal

Ranchers heard the same price drop as a hit on the only incentive that rebuilds cows. Colin Woodall, chief executive of the National Cattlemen’s Beef Association, issued his statement on Aug. 21, the morning cattle futures sold off.

NCBA is disappointed by the President’s statement. While America’s cattle producers share the goal of keeping groceries affordable for consumers, flooding the market with government-subsidized, below-market beef is not the way to rebuild the American cattle herd. Cattle markets have already turned sharply lower this morning, to the detriment of farmers and ranchers. This is a critical time of year for cattle producers, as we approach the season where they are making decisions regarding their herds. Cattle farmers and ranchers are responding to strong market signals and historically high demand, and we are already working to rebuild after years of ongoing drought, high input costs and other challenges that have reduced U.S. cattle numbers. Today’s announcement and other market interventions throw cold water on the prospect of herd expansion and sacrifices long-term stability for short term messaging.

Colin Woodall, Chief Executive Officer, National Cattlemen’s Beef Association

Woodall’s line that the plan would throw cold water on herd expansion is the rancher case in one clause. Zippy Duvall, president of the American Farm Bureau Federation, said the country was already importing beef at record levels and that the extra tons would mean a large jump in imports over 90 days. A joint letter from Farm Bureau, NCBA, the Livestock Marketing Association, and the U.S. Cattlemen’s Association called the discount a disheartening message at the moment producers decide whether to keep heifers.

Packers can lose money in the same month grocery beef looks expensive, because the animal is the cost and the case is the price, and those two markets do not move as one. Tyson is large enough that when it idles Joslin, Midwest feeders roll cattle farther and bids in that corridor sag. When Washington then adds trim at a discount, the cattle Tyson already owns are worth less on paper. The public argument that a packer “should” profit when burgers are dear skips that spread. The plant worker still loses the shift either way.

Jeff Schomburger Takes the Microphone in Boston

King is still the president and CEO on the Sept. 3 letterhead. Incoming president and CEO Jeff Schomburger, with chief financial officer Curt Calaway, will take a fireside chat at 10:30 a.m. EDT on Sept. 10 at the Barclays Global Consumer Conference in Boston. Schomburger was already on the Aug. 3 earnings call as the incoming chief. He now inherits a year whose profit target has been cut twice, a beef network mid-shutdown, an open import tranche, and a chicken business that is, at the low end, the entire company.

King’s closing line was that the multi-protein portfolio helps Tyson manage pressure from individual commodity cycles, and that the firm enters fiscal 2027 with a healthy balance sheet, branded momentum, and a clear growth plan. Prepared Foods, he said, keeps performing well on brands, pricing, and new products. International is delivering as expected. Those sentences can all be true in the same week beef is still large enough to force another cut, and in the same week the first 100,000 metric tons of lean trim are already eligible to clear a U.S. dock.

The cattle that would refill Joslin are not in the pipeline. The savings King wants from a three-plant map are a fiscal 2027 story. The inventory mark is a fiscal 2026 story, and that year is almost out of calendar.

Disclaimer: This article is news reporting and analysis of Tyson Foods’ public outlook, USDA cattle figures, and the Aug. 26 presidential proclamation. It is for information only and is not investment advice, a recommendation to buy or sell Tyson shares or any other security, or a forecast of future earnings, cattle prices, or grocery prices. Readers who are weighing a position in Tyson or in livestock markets should consult a licensed financial adviser or commodities professional who can review their own facts. The profit ranges, herd counts, plant plans, and tariff volumes here reflect the company, USDA, and White House texts cited, and those figures can change with later filings, reports, or proclamations.