How Beef Processing Works | Business of Beef | Cargill

Processing explained

What does a beef processor do?

Processors buy finished cattle from ranchers and feedyards, then process them in USDA-inspected facilities into cuts such as steaks, roasts and ground beef that reach stores, restaurants and food manufacturers. The process also generates byproducts like tallow, hides and bone meal that have their own value in the supply chain. Together, these products and byproducts make use of 99.9% of the animal.
Cattle are purchased three ways: live weight, carcass (hanging) weight or grid pricing based on quality grading. Each animal becomes many cuts from 11 primals. The combined value of those cuts is the boxed beef cutout, or total carcass value.
Beef processing requires significant investments in facilities, infrastructure, equipment, packaging, food safety and more. The largest processing cost is wages for employees. These costs, combined with the price paid for cattle, determine the economics of processing, a business that operates on narrow margins in a competitive market.

Cargill beef

What does Cargill do as a processor?

Cargill processes beef in USDA-inspected facilities and supplies retailers, restaurants, foodservice companies and manufacturers across the U.S.

Meet our beef team

22,000

Employees

Cargill’s beef business employs 22,000 people across its U.S. operations.

22 Processing and distribution centers

Cargill processes and distributes beef through 22 facilities across the U.S.

187M

Servings of steaks and roasts

Cargill produces more than 187 million servings of USDA-graded beef steaks and roasts every year.

126M

Beef burgers per year

Cargill supplies beef for more than 126 million beef burgers each year.

Carcass value

How do the economics of beef processing work?

The economics of beef processing start with the value of what each animal becomes: steaks, roasts, ground beef and other cuts, plus byproducts like hides and tallow. From that value come the costs to produce it: the price paid for cattle and the labor and operating costs of processing. What remains is the economic outcome. When values or costs change, such as what cattle cost or what customers pay for beef, the outcome changes, too.

Diagram of the economics of beef: the value of meat and byproducts, minus the cost of cattle and processing costs, equals the economic outcome.

“Processing is a margin business at every step. We buy cattle at market rates, run facilities with fixed costs and sell to retail and foodservice customers. Understanding that structure is key to understanding how the beef system works.”

Jarrod Gillig

SVP of North America Beef, Cargill, and a cattle rancher

Sustainable beef

From ranch to your table

How Cargill works with ranchers

Cargill works with thousands of family farmers and ranchers to make beef production more efficient and sustainable, from grazing practices on the ranch to the beef that reaches your table.

Watch the video

From the Wall Street Journal

Inside the beef market

A rancher and processor on beef supply

At the 2026 Wall Street Journal Global Food Forum, Kansas rancher Debbie Lyons-Blythe and Cargill’s Jarrod Gillig discuss drought, the cattle cycle and what’s behind today’s tight beef supply.

Watch the full conversation

Beyond beef

Every part matters

Cargill uses 99.9% of every animal. Beyond beef, byproducts like tallow and bone meal have their own uses, and hides become the leather for more than 1.8 million official Major League Baseball balls each year.

Read the full story

Keep exploring the beef system

How beef moves from feedyard to fork