The Holcomb plant made up 6% of U.S. slaughter capacity. Tyson, prior to the fire, held the largest share of the country’s beef processing capacity at 29%, followed by JBS at 23%, Cargill at 22% and National Beef at 12% of the U.S. slaughter capacity, with the remaining 12% comprised of smaller, independent packers.

Veselka carrie
Editor / Progressive Cattle

The Holcomb cattle were swiftly shuffled to other facilities, keeping the fire’s impact on the overall volume processed relatively low except for the days immediately following the fire. A different concern arose as to how market prices would respond after the Tyson plant, both a significant cattle buyer and beef processor, was temporarily taken out of the market.

Beef values jumped almost $24 per hundredweight (cwt) in the weeks following the fire. Prices started out at $216.04 per cwt the week of the fire and rose to $230.43 per cwt the week after the fire, then to $239.87 per cwt the week after that. The third week after the fire saw prices recede slightly to $234.35 per cwt.

Cattle prices took a nosedive following the fire. In the month leading up to the fire, both feeder and fed cattle futures were holding pretty steady. Immediately following the fire, futures for feeder and live cattle dropped 8% and, since then, have only rebounded slightly and continue to experience a lot of volatility.

On Aug. 28, U.S. Ag Secretary Sonny Perdue announced the launch of an investigation by the USDA’s packers and stockyards division into beef pricing margins following the Holcomb fire “to determine if there is any evidence of price manipulation, collusion, restrictions of competition or other unfair practices.”

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“If any unfair practices are detected, we will take quick enforcement action. [The] USDA remains in close communication with plant management and other stakeholders to understand the fire’s impact to industry,” Perdue said in a statement. “I know this is a difficult time for the industry as a whole.”

Perdue’s announcement has received support from several beef industry groups who see it, among other things, as a step toward greater transparency in the markets. end mark

Carrie Veselka