The largest meat producer in US just warned that more meat shortages are coming as its profits fall 15%

The largest meat producer in US just warned that more meat shortages are coming as its profits fall 15%
Workstation divider at Tyson Foods' Chick N Quick plant in Rogers, Ark. April 24, 2020Tyson Foods

  • Tyson's second-quarter profits fell nearly 15%, it said Monday, as the coronavirus pandemic upends the United States food supply chain.
  • The largest US meat producer said more shutdowns are likely, and that it cannot predict the full impact they will have.
  • In April, the company took out major spreads in large newspapers to warn of the pandemic's effect.
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Tyson, the largest US meat producer, said second-quarter profits fell 14.5% from last year as the coronavirus pandemic upsets supply chains and disrupts processing plants across the country.

Total sales for the three-month period ended March 28 rose nearly $500 million, but the company warned volumes are likely to fall in the second half of the year as upticks in grocery store sales aren't enough to offset the drop-off in restaurant demand.

"We have and expect to continue to face slowdowns and temporary idling of production facilities from team member shortages or choices we make to ensure operational safety," the company said in a press release. "The lower levels of productivity and higher costs of production we have experienced will likely continue in the short term until the effects of COVID-19 diminish."

Tyson, which employees about 100,000 workers, was forced to close multiple meat-processing plants in April after multiple workers fell ill with the coronavirus. Those stoppages have already led to a supply shortage, with the company taking out a full-page ad in major newspapers to warn that "millions of pounds of meat will disappear from the supply chain."


As of April 27, at least 1,185 workers from eight Tyson plants have contacted COVID-19. At least eight workers — in Camilla, Georgia; Wallula, Washington; Columbus Junction, Iowa; and Dakota City, Nebraska — have died, according to a Business Insider analysis of health department data and news reports. Tyson declined to share specific numbers, citing an "ever-changing situation."

The United Food and Commercial Workers International Union estimates that plant stoppages have reduced pork slaughter capacity by 25% and beef slaughter by 10%, according to CNN.

On April 29, President Donald Trump signed an executive order ordering meat processors to remain open, invoking the same Defense Production Act previously used to turn automakers into ventilator producers in March. But despite the order, some grocery retailers, including the national chain Kroger, have started limiting ground beef and pork purchases in some stores.

Shares of Tyson fell more than 8% in trading Monday, outpacing wider market losses, following the results and a warning that the company can't yet forecast the full effect of the pandemic.

"We cannot currently predict the ultimate impact that COVID-19 will have on our short- and long-term demand at this time, as it will depend on, among other things, the severity and duration of the COVID-19 ," Tyson said.

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