Tyson Foods Inc. (NYSE:TSN) lowered its full-year profit outlook after reporting another quarterly loss in its beef business, saying historically tight cattle supplies and elevated livestock costs are expected to continue weighing on results well into 2027 despite recent federal action to increase imports.
The company’s beef segment posted an operating loss of $138 million during the third quarter, with sales volumes falling 15.9% while average pricing increased 12.1%, reflecting continued supply constraints across the U.S. cattle industry.
Companywide, Tyson narrowed its fiscal 2026 sales growth guidance to 2.5% to 3.5%. The company now expects its beef business to generate an operating loss of as much as $650 million for the fiscal year.
Chief Executive Officer Donnie King said the recent decision by the U.S. Department of Agriculture to reopen the border to Mexican cattle and beef imports represents a positive development for the industry but is unlikely to materially improve supply conditions in the near term.
Last week, the USDA resumed imports of Mexican cattle and beef after restrictions were imposed earlier this year in response to the spread of New World screwworm. Federal officials said the reopening follows enhanced animal health protocols designed to reduce the risk of the parasite entering the United States.
King said the move offers “the potential for some level of improvement in 2027 and beyond,” but cautioned that it will not resolve the industry’s current supply shortfall.
“To be clear, the reopening of the Mexican border will not solve the entire gap of beef losses we are currently seeing,” King said during the company’s earnings call. “We are not waiting passively for the cattle cycle to turn.”
Tyson executives noted that many of the animals entering from Mexico are feeder cattle that require several months before reaching processing weight, delaying any meaningful impact on beef supplies.
The comments reinforce broader concerns about the pace of the U.S. cattle herd recovery. USDA data released in July showed the nation’s beef cow herd remains at its smallest July inventory since 1973, while the 2025 calf crop was the smallest on record, suggesting beef supplies are likely to remain constrained for the foreseeable future.
Higher cattle costs have pressured processors across the industry even as retail beef prices remain near record levels. Tyson said consumers continue to shift purchases toward lower-cost proteins such as chicken and pork, businesses that delivered stronger results during the quarter.
The company has continued restructuring its beef operations in response to the difficult market. Tyson closed one of its largest beef processing plants in Nebraska last year and reduced production at another Texas facility as part of ongoing efforts to improve efficiency.
Other processors have taken similar steps. Earlier this year, JBS announced the closure of two U.S. beef plants amid continued pressure on industry margins.
Tyson executives said operational improvements remain a priority, but acknowledged that meaningful improvement in beef profitability will depend largely on the pace of herd rebuilding rather than short-term policy changes.