Tyson Warning Underscores Persistent U.S. Beef Supply Crunch
Drought remains widespread across key cattle states, while record ground beef prices reflect continued tight supplies despite early signs of herd rebuilding.
Bloomberg reported today that Tyson Foods Inc. lowered its annual profit outlook, highlighting that the U.S. beef industry’s historic cattle shortage continues to weigh on the sector.
Though a planned resumption of Mexican cattle imports and initial herd-rebuilding efforts offer recent signs of hope, these developments will not relieve supply pressures for beef packers anytime soon, Bloomberg said.
The US cattle herd totaled 94.2 million head as of July 1, up slightly from 94 million a year earlier, according to a USDA report late last month.
A separate USDA report last week showed Texas had 59% of its cattle in drought as of July 28, including 37% in severe drought (D2) and 2% in extreme drought (D3).
Nebraska remained one of the hardest-hit states, with 91% of cattle in drought, including 40% in severe drought, 17% in extreme drought and 1% in exceptional drought (D4), while Kansas reported 53% of cattle in drought, primarily in moderate (34%) and severe (19%) drought.
California reported no cattle in drought.
Agency data showed drought conditions for U.S. cattle worsened sharply through the spring, with the share of cattle in moderate or worse drought (D1+) climbing from 36% in early January to a peak of 64% in early April before easing to 48% as of July 28.
Ground beef prices continued to climb through the first half of 2026, rising from $6.87 per pound in January to a record $7.14 in June, according to Bureau of Labor Statistics data.
The increase was largely uninterrupted, with only a modest dip in March before prices resumed their upward trend.