JBS’s Bautista to visit Wyoming next weekWritten by Jennifer Womack
Wesley Bautista, whose family owns JBS-Swift, will speak at the Marketing Committee meeting on Thursday, June 5 at 9:30 a.m. He’ll be followed by R-CALF USA Vice President and Wheatland cattle feeder Randy Stevenson.
JBS-Swift plans to purchase National Beef Packing Co., Smithfield Beef Group and Five Rivers Ranch Cattle Feeding. The merger would make Bautista’s company the largest packer in the nation. U.S. Department of Justice officials are reviewing the proposal that groups like R-CALF USA oppose.
“We’re fully complying and giving them all of the information they need to make their decision,” said Chandler Keys of JBS Swift during a May 29 interview with the Roundup. Keys will accompany Bautista when he travels to Casper next week. “We have no idea nor do we want to speculate on what their timeline is. They have an initial look-see for 30 days for any kind of acquisition in the U.S. After that they decide to look further and that’s what they’re doing now and I think everybody expected them to do that with this acquisition. It’s an extensive review.”
Asked about cattle producer concerns surrounding the merger Keys said, “I think the better way to look at it is JBS has made a decision to place approximately $3 billion of their resources into the U.S. red meat industry, particularly cattle and beef. To me that would be a vote of confidence in the U.S. beef industry that this is a good place to invest, that the beef industry has a bright future and that JBS would like to be a part of it. There was no other company nor group of investors that were interested in making that kind of investment.”
Keys said the Bautista family’s exemplary work ethic and appreciation for innovation could spell economic opportunity for the nation’s beef industry. Of packing facilities the family purchased in Italy, he says they see them as laboratories to explore new technologies and opportunities. Just home from his second trip to the Bautista’s native Brazil where their father started in the industry slaughtering just a couple head a day, Keys said, “I’m very impressed by the modern facilities they have, the amount of capital, the amount of time and effort they put into each one of their plants and how they keep up with technology.” That innovation, said Keys, adds economic potential to each animal processed.
“At the end of the day, we have to work with cattle producers to increase demand for beef because all our money, all of our resources that come into this business from the cow-calf guy outside of Casper, Wyo. to a processing plant in Chicago, the only money that comes into this industry is from the consumption of beef from the consumer, be it here in the United States or globally.”
Key said, “The demand for the end product is where the resources come from for us to be successful. Our true belief is that coordination and cooperation with producers, with retailers, with wholesalers and those moving this product from a live animal to a piece of meat and working through the chain system to improve demand domestically and globally for beef, we think we can all be successful. That’s what we believe in.” Keys said JBS’s global presence could help make that happen.
Others don’t see economic opportunity in the pending acquisition, but reduced competition for the cattle they sell. Billings, Mont.-based R-CALF USA has filed what Stevenson describes as “volumes of information” on the proposed merger. The latest came May 28 when R-CALF USA presented the DOJ with a report saying the merger would be damaging to cow-calf producers, backgrounders and stockers due to a lessening of competition in the feeder cattle market.
R-CALF has also been working with attorneys general from across the nation to encourage them to join forces and legally challenge the merger if it’s allowed to move forward.
Stevenson said the Wyoming attorney general’s office has joined a list of “numerous” other AGs in reviewing the pending acquisition. If the DOJ allows the merger to move forward the AGs, as do individuals and industry organizations, have the right to file suit in an effort to block the action.
On May 28 R-CALF USA CEO Bill Bullard said, “We are recommending that the Justice Department consider conducting a national survey, perhaps with the assistance of state attorneys general, to better determine the effect that the merger of Five Rivers and U.S. Premium Beef/National Beef Packing, under the auspices of JBS-Brazil, would have on the competitiveness of each state’s market outlets for feeder cattle.”