By:Cindy Gonzalez
Nebraska Examiner
LINCOLN — In a blow to the local economy of Lexington, Nebraska, Tyson Foods announced that it is closing the town’s longtime Tyson beef plant that employed about 3,200 people.
The Arkansas-based Tyson said in a statement that changes were designed to “right-size” its beef business and position it for long-term success.
The Lexington plant is to close on or around Jan. 20. The statement did not elaborate on why the plant in the town of about 11,500 people was targeted.
The company said it also will convert an Amarillo, Texas, beef facility to a single, full-capacity shift and increase production at other company beef facilities. The number of layoffs from that eliminated shift is about 1,700.
A recent earnings report indicated that Tyson stands to lose some $600 million in its beef business next fiscal year, on top of the already-incurred $720 million loss over the last two years.
The closure sparked swift reaction from Nebraskans.
The Nebraska Cattlemen Board of Directors expressed disappointment — especially, it said, in light of Friday’s U.S. Department of Agriculture data that Nebraska cattle-on-feed inventories remain slightly above year-ago levels in spite of the ongoing cyclical tightness in national cattle numbers.
“We firmly believe there isn’t a better place to efficiently and economically raise cattle and produce beef than Nebraska,” the board said in a statement. “This will have a profound impact on the community of Lexington and many cattle producers.”
Nebraska Gov. Jim Pillen called the state’s cattle industry resilient and “the envy of the world.” He said Tyson leadership promised to “work on future value-added opportunities” in the state.
“Big picture — our excellent cattlemen and cattle feeders have emerging opportunities and will still have the Tyson market to sell into as its planned re-organization will boost capacity and jobs at other Nebraska plants,” Pillen said.
But U.S. Sen. Deb Fischer, R-Neb., a member of the Senate Agriculture Committee, blasted the decision.
“As the single largest employer in Lexington, Tyson’s announcement will have a devastating impact on a truly wonderful community, the region and our state,” she said.
Calling Nebraska a beef state that knows better than anyone the highs and lows of the cattle market, Fischer added: “It’s no secret that just a few years ago, packers like Tyson were making windfall profits while the rest of the industry was continuously in the red.”
“I call on Tyson to do everything in its power to take care of the families affected by this short-sighted decision,” she said.
U.S. Sen. Pete Ricketts, R-Neb., said he would do what he could to support Nebraskans impacted and to help employees find work close to home.
“This news is especially heartbreaking around the holidays,” he said.
U.S. Rep. Adrian Smith, R-Neb, called the closure a disappointing loss for the city, Dawson County, the region and cattle industry as a whole.
“Nebraska’s hard-working cattle producers are innovative and highly efficient as they work to provide high quality beef for consumers,” Smith said. “I welcome input from producers and stand ready to assist as we all move forward.”
In its announcement, Tyson said it recognized the impact its decisions have on its team members and their communities.
“The company is committed to supporting our team members through this transition, including helping them apply for open positions at other facilities and providing relocation benefits,” it said.
U.S. Rep. Mike Flood, R-Neb, said in a statement that ranchers “dutifully raised cattle even when times were hard. Now they are being abandoned.”
He said that after Tyson closed its Norfolk plant in 2006, it “stripped the plant bare” and the property couldn’t be used as a beef processing facility. He said the plant still sits empty today.
Said Flood: “As they wind down their Lexington plant, Tyson needs to preserve it, so it can remain a beef processing operation and keep good paying jobs in Dawson County that support our ag communities.”