NASHVILLE, TENN. (RFD-TV) — Tight fed cattle supplies are already straining packer margins, and the coming shutdown of Tyson’s Lexington, Nebraska, beef plant will further shift how slaughter capacity is used nationwide. Dr. Charley Martinez, Assistant Professor at the University of Tennessee Institute of Agriculture, analyzed the expected impact using updated 2025 slaughter and utilization data.
The Lexington facility accounts for roughly 5,000 head per day — about 20 percent of Tyson’s total daily capacity. Removing that volume raises national capacity utilization (CU) closer to historical levels. Martinez’s adjusted model shows 2025 CU improving from 83.1 percent to 87.7 percent, nearer the five-year average of 90.1 percent.
Operationally, November CU fell to 83.5 percent, well below last year and historical norms. The adjustment suggests the industry currently holds more physical capacity than available cattle supplies can support.
Regionally and historically, this marks the largest major-plant closure since Cargill shuttered Plainview in 2013 amid similar tight-supply conditions. Martinez notes that new facilities expected in 2026–27 could reshape CU again, depending on herd rebuilding.
Looking ahead, the key uncertainty is whether today’s adjusted CU represents a short-term imbalance or a longer-run structural shift.
Farm-Level Takeaway: The Lexington shutdown pushes national slaughter capacity utilization nearer long-run averages, underscoring how tight cattle supplies are reshaping packer operations.
Tony St. James, RFD-TV Markets Specialist
New World Screwworm cases in Mexico, including one within 200 miles of the U.S. border, are adding pressure to livestock markets and trade decisions.
January 06, 2026 12:09 PM
·
Preserving equity through active risk management remains critical in a volatile, supply-driven market.
January 06, 2026 06:00 AM
·
Bigger cows must wean proportionally heavier calves to justify higher ownership costs.
January 05, 2026 03:08 PM
·
A look at the legislative year ahead as lawmakers return to Washington with a slate of trade concerns to tackle in 2026—from new Chinese tariffs on beef imports to the USMCA review this summer.
January 05, 2026 12:20 PM
·
Shaun Haney, Host of
RealAg Radio on Rural Radio SiriusXM Channel 147, joined us with his 2026 cattle market outlook and insights on beef prices.
January 05, 2026 10:41 AM
·
The New Year is here, but in Oregon, some ranchers and livestock producers are still trying to recover from record wildfires back in 2024.
January 05, 2026 09:46 AM
·
As markets anticipate a return to normal trading following the New Year’s holiday, the possibility of the southern border re-opening to cattle is capturing much attention.
December 30, 2025 11:28 AM
Expanding cheese exports are strengthening U.S. milk demand and reinforcing global competitiveness.
December 27, 2025 07:00 AM
·
U.S. dairy producers remain the primary growth engine globally, while tightening supplies in Europe and New Zealand could support export demand for American dairy products.
December 26, 2025 12:00 PM
·
