**SPRINGDALE, Arkansas** — Tyson Foods lowered its annual profit forecast on August 3, projecting that losses in its beef segment will widen as tight U.S. cattle supplies continue to drive up livestock costs.
The announcement underscores ongoing challenges for U.S. meat producers, which have faced financial pressure as rising cattle costs outpace increases in beef prices. Earlier this year, Tyson closed a major beef plant in Nebraska and reduced operations at a Texas facility, resulting in thousands of layoffs.
U.S. cattle supplies have dropped to a 75-year low following prolonged drought that damaged grazing lands in the western United States. Supplies were further constrained after Washington suspended cattle imports from Mexico to prevent the spread of the New World screwworm pest.
While the Trump administration has stated plans to begin lifting the import ban this month, Tyson executives cautioned that the move will not provide immediate relief.
“The reopening of the Mexican border will not solve the entire gap of beef losses we are currently seeing,” CEO Donnie King said during a conference call, adding that restarting imports could yield some improvement by 2027 and beyond.
Chief Operating Officer Wes Morris explained that imported feeder cattle will still require time to graze or be fattened in feedlots before they are ready for slaughter, meaning benefits could take up to a year to materialize.
Tyson now expects fiscal 2026 adjusted operating income to range between $2.1 billion and $2.3 billion, down from its previous projection of $2.2 billion to $2.4 billion.
The company also widened its projected adjusted operating loss for its beef business to between $500 million and $650 million, an increase from its earlier estimate of $350 million to $500 million.
“Beef hasn’t performed the way we expected, and we’re not pretending otherwise,” King said.
During the quarter ended June 27, beef sales volumes fell 15.9 percent, while prices rose 12.1 percent.
Higher beef prices have driven some consumers toward cheaper proteins like chicken, helping to offset weakness in Tyson’s largest business segment. Chicken sales volumes increased by 1 percent during the quarter, and the adjusted operating margin in that segment rose to 11.2 percent. Tyson stated it expects “another constructive year” for its chicken business in 2027.
Overall, Tyson reported quarterly sales of $13.87 billion, falling short of analysts’ estimates of $14.12 billion. The company forecasted annual revenue growth of 2.5 percent to 3.5 percent, compared with analysts’ expectations of 4.3 percent.
Article and image source: mexicostar.com
