Organization for Competitive Markets: President Trump Should Say No to Brazil’s Beef Import Deal

April 15, 2019

“With this acquisition, we become the largest beef company in the world.” With these words, JBS President Joesley Batista set in motion what today has become an invasion of the U.S. beef market by Brazilian corporations. Batista uttered these words in 2007 during JBS S.A.’s announcement that it had just purchased the U.S.’s third largest beef processor, Swift Food Company.

A year later, JBS seized on the opportunity to expand its U.S. acquisitions and purchased Smithfield Beef Group, Inc. The advancement of JBS in the meat market has been devastating but what makes it even more shocking is leaders of JBS S.A. have admitted that their Brazilian government corruption activities allowed them to make these advancements in the U.S. markets.

As if they were reinforcements on a battlefield, one year ago, Brazil’s Marfrig Global Foods, S.A. joined JBS in the Brazilian takeover of the U.S. beef industry. Marfrig’s NBM US Holdings acquired a controlling interest in National Beef Packing Company, the U.S.’s 4th largest beef processor.

These Brazilian corporate takeovers have left four companies controlling over 80% of the beef market, and these two Brazilian global giants are now racing to gobble up the rest of the U.S. beef market. Last month Marfrig’s National Beef purchased Iowa Premium, and last Friday Lisa Keefe reported in Meatingplace that JBS is purchasing Nebraska-based Imperial Wagyu Beef.

You would think with all the talk in Washington, D.C. about securing our borders, someone would be taking action to secure our borders from this Brazilian invasion in our markets and to protect our U.S. cattle producers. But no… just the opposite is happening.

After meeting with Brazil’s president last month, President Donald Trump opened the door for Brazilian beef to once again be brought into the U.S. In a joint statement, the two presidents announced the U.S. will “expeditiously schedule a technical visit by United States Department of Agriculture’s Food Safety and Inspection Service to audit Brazil’s raw beef inspection system.”

Besides the human health and safety issues and the risk to our cattle herds, this Presidential action will surely be the final assault on U.S. cattle producers breaking their backs as well as their bank accounts.

How so?

Our president is dealing Brazil’s global giants all the cards in the U.S. cattle industry. Brazilian cattle buyers in the U.S., JBS and Marfrig, now dominate the U.S. cattle market leaving many U.S. cattle producers at their mercy for how much they will be paid for their cattle. If U.S. cattle producers don’t like the price they are offered, these Brazilian corporations will simply say, ‘OK, we will just bring in our beef from Brazil and the other South American countries and fill our U.S. orders until you take our price for your cattle.”

If this deal goes forward, President Trump is guaranteeing American prosperity to Brazilian corporate interests and taking it away from U.S. cattle producers and the rural communities where they live.

President Trump should realize not all deals are good deals and reject lifting restrictions on Brazilian fresh beef.