Tyson Foods Beef Packing Plant to Rebuild, Market Impacts from Fire

Courtesy of: Texas Cattle Feeders Association

Tyson is working “as quickly as possible” to return its Holcomb, Kan., beef processing facility to full operations after fire on August 9 caused major damage, Tyson Fresh Meats Division President Steve Stouffer said in a Wednesday press conference. While the plant is working to get back up and running quickly, Stouffer said, “It will be a matter of months, not weeks, but no specific timeline at this point.”

The Holcomb plant represents approximately 6% of the total U.S. fed cattle packing capacity and 23.5% of the Kansas fed slaughter.

Cattle market declines slowed on Wednesday, after two days of being limit-down at the beginning of the week. Compared to last Friday, August Live Cattle closed at $99.93/cwt, down $8.13/cwt from last week, while October closed at $98.05, down $8.70. August Feeder Cattle closed at $134.58, off $4.33 and September finished the week down $6.08 at $132.38/cwt. On Wednesday, all packers participated in the cash cattle trade at $105.00/cwt.

Beginning Saturday morning, TCFA staff and leadership reached out to Tyson, Cargill, JBS and National to assess the impacts of the Holcomb plant fire and determine what accommodations would help allow for increased processing capacity at other plants, minimize uncertainties, and help stabilize the markets. Following that outreach, TCFA called and met with USDA agency leaders this week to emphasize the need for regulatory flexibility and ability to shift agency personnel as needed to increase capacity at other plants. Throughout the week, TCFA staff coordinated communications and outreach efforts with NCBA, CattleFax and other cattle feeding state affiliates whose members are directly affected by this incident.

In letters to members on Wednesday and Friday, President Jennifer Houston, explained key steps being taken to minimize economic disruption and help the industry recover as quickly as possible.

Those steps include asking the National Economic Council at the White House for regulatory flexibility; communicating closely with the Commodity Futures Trading Commission (CFTC) and the Packers and Stockyards Division to ensure they keep a close eye on the cattle markets and remain vigilant; and requesting that the U.S. Department of Transportation provide an Hours of Service waiver for the next nine months to allow trucks to transport live cattle to other plants for processing. You can read the letters to DOT, CFTC and USDA at NCBA.org.

On Thursday, USDA Undersecretary Greg Ibach responded to the crisis with a statement, ensuring cattle producers that USDA is closely monitoring the situation. Secretary Ibach’s statement can be read in its entirety here.

TCFA staff and leadership will continue to engage with NCBA, the packers and USDA agencies over the next several weeks.

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