The Real Reason Tyson Is Cutting Prices On Beef Products

Tyson Foods announced that it would lower the price of select beef products. What motivated the meat company, the biggest in the U.S. by sales, to make this move? Basically, it's to keep beef affordable. The manufacturer processes about one-fifth of the nation's beef, so its decision to cut down prices for ground beef, roasts, and other beef products for restaurants, grocery stores, and other consumers this week is a big one. The discounts will reach as much as 20 to 30 percent, depending on the product (via MarketWatch).

The company decided to provide discounts in order to help "keep beef on family tables" amid temporary closures of several Tyson facilities due to COVID-19 outbreaks and subsequent staff shortages (via Fox News). At a Tyson plant in Iowa, more than 700 workers tested positive for coronavirus earlier this month. The company also had to close a large beef factory in Nebraska in late April because of an outbreak (via Today).

Tyson is among other meat manufacturers facing this issue, which has contributed to meat shortages and higher beef costs. According to recent information from the U.S. Bureau of Labor Statistics, the price of uncooked ground beef increased by 4.8 percent between March and April. Grocery costs rose 2.6 percent during that same period, which was the highest one-month jump in the U.S. since 1974, as reported by the Department of Labor. This leap was headlined by a 4.3 percent increase in the price in the meat, poultry, fish, and egg category.

According to Fox News, these discounts from Tyson will be in effect for the rest of this week. In a statement, the company shared that its decision would benefit the consumer as well as those working throughout its supply chain as well as the cattle industry. Tyson recognized that the ongoing pandemic has created disruptions throughout the food system in recent months, affecting its operations and customers. The meat manufacturer believes this move will help the supply chain rebound, especially cattle producers, since it will work to maintain beef consumption as its plants begin to return to more normal levels of production.

This will be a welcome improvement, as last week's nationwide production of beef, pork, and other red meat was 28 percent lower than the same period of the year prior, according to the USDA. The status of the meat industry drove John H. Tyson, the chairman of the company's board, into taking out full-page ads in The New York Times, Washington Post, and Arkansas Democrat-Gazette last month to outline Tyson's response to the crisis. He also warned that additional closures, not just at Tyson but also at its competitors, would put more stress on a crumbling food supply chain.

Now Tyson is singing a more positive tune. As seen in Fox News, the meat company stated that though these are unprecedented times that have been difficult, it believes that "the future is bright."