A Canadian Look at JBS

[Willowcreek]

Sheri doesn't mince any words- and tells it like it is....

------
JBS is no gomer



Sheri Monk

Maple Creek News - Canada

29-05-2008



A gomer is a bull which wants to breed, physically can breed, but can’t make a calf. Gomers aren’t castrated and are used to mark a cow when she’s in heat.



The bull climbs on, gets off, but leaves a mark on the cow with chalk or paint which is strapped on under his chin. Then, the real bull can be turned out, she’ll stand for him and hopefully, she’ll take.



This concentrated meatpacking business has made a lot of cattlemen stand for a lot more than they should have ever had to take, and it’s only getting worse.



Last year, JBS of Brazil bought Swift & Co., proudly declared themselves as American as apple pie and renamed the massive company JBS Swift.



JBS is the largest packer in all of South America and is trying to buy three critical components to the US cattle business.



If they succeed, they will have become the largest meatpacker in the U.S. and the world in just one year.



It doesn’t matter if you’re growing apples, organizing rodeo or selling real estate. If there’s too few in control of too much, the wreck is on and your average citizen will take a beating for it.



JBS is planning to buy National Beef, Smithfield Beef and Five Rivers Ranch Cattle Feeding. R-CALF has been raising hell over the deal and with good reason. Several U.S. governors and attorney generals have signed letters of protest, expressed concern and generally sounded the alarm bell.



At the end of the day, I think the deal will go through because JBS is already behaving as though it has. If they thought it was going to go south, they’d behave as responsible corporate citizens. They’d be buying television commercials to show the world how pleased they are with how they turned out.



Instead, JBS has mounted the American cattle business and won’t get off. A couple of weeks ago, JBS started sending contracts to U.S. feedlots that requires they waive any rights they have under the trust provisions of Section 206 of the Packers and Stockyards Act.



Not that anyone’s enforced the trust act for decades, but at least there was a glimmer of hope.



If that weren’t enough, the contract also demands the right to withhold payment for grade. Sounds to me like they know they’ve got the deal sewn up and shut solid and I guarantee you, this is no gomer screwing us.



Yes, us. You can turn your Canadian eyes away from the wreck. You can read this and tiptoe out of awareness as if you’ve just walked in on your parents in the bedroom, but this deal is going to take and it’s going to make this business harder for everyone in it, including us.



Ultimately, shoppers are not going to care who buys the beef they want to eat. This COOL (country of origin labeling) deal is nothing in comparison to this JBS swindle.



Shoppers, for the most part, couldn’t care less where products come from which is why everything we buy is made in China.



And if one company out of Brazil ends up owning every cow and every cattleman in America or the world, people won’t care about that either.



Which is why folks who understand what’s going on in the business have to take a stand on this, even if it’s happening south of the border.



We all know how stupidly dependent we are on the U.S. to support our cow business. Like it or not, that’s the way it is and unless our politicking cattlemens groups like CCA, ABP and SSGA are taken by coup, it’ll never change.



Even if the JBS deal would never affect us (which it will) we should still scream over it because it’s wrong–plain and simple. People still ought to do what needs done for the simple reason that it needs doing.



Look at our packers–Tyson, Cargill and XL Foods. Tyson and Cargill are always the bad Americans and XL is given a free pass because they were born in Canada.



Well, I’ll tell you what. Soon as the border opened to UTM (under 30 month) Cdn. cattle, XL took that pile of BSE money they made and opened shop in America to get in on the same north-south screwing we all seem so happy to keep showing up for. That’s how Canadian they are.



In this new era of globalism, patriotism exists only in song and sport. Sing the anthem all you want, but we’re dancing to the same beat and we’re all going to take the same breed of beating. No matter where you live, it’ll hurt.



maplecreeknews.com

[rkaiser]

Good on you Sherry, but I think it is a loosing battle. I have given up on herding chickens and am concentrating my efforts on our niche marketing. Got our second shop[ open in Calgary in March and going down to sell myself and help open a third this summer. When a growing number of consumers is willing to pay our company $29.99 a pound for bone out rib eye and new york strips, why the hell would I waste any more of my 30 years in the cattel biz on giant slaying or dealing with ego's at the political or industry level.

Hope things are good with you Oldtimer.

Randy

[grassfarmer]

Sure, herding chickens can be dispiriting Randy and appear futile at times but I think our role as "activists" (or @#@% stirrers) is not to change the status quo by winning some David and Goliath battle as individuals. To my mind our role is to create greater awareness of the situation so that more producers, more consumers become aware of what is going on. I do believe in democracy ultimately and that things have a way of working out over time and restoring a kind of natural balance. I think in the beef situation that will come about with increasing quality, welfare and traceability demands driven by the consumer, demands which you are well aware of in your natural beef selling business. I do not agree with the preceding article's comment that "consumers couldn't care less where products come from which is why everything we buy is made in China." This is not, and increasingly will not be true of the food choices made by consumers.
I respect the fact that you have to concentrate on your own business interests, we all have to ensure our own survival first and foremost, but I think this is in reality just moving the battle to a new stage. Dealing direct with consumers I'm sure you'll inspire them to seek change in much the same way you've inspired many beef producers over recent years. Thanks for all your efforts Randy.

[6cylinder]

THIS TELLS A DIFFERENT, PERHAPS MORE ACCURATE
TALE...

Smoke & Misdirection

R-CALF Casts Their Bogeyman Net Further Afield


Determined to cast aspersions on the proposed
purchase of Smithfield and National Beef by JBS
Swift, R-CALF's Bill Bullard has issued statements
that appear to distort and misrepresent how the
deal would affect feeder cattle markets and
feedyards.

A rabid opponent of cattlemen's beef alliances and
branded programs, Bullard seems not to
understand what U.S. Premium Beef (USPB) is or
how it operates.

"Post-merger, all competing order buyers who are
now filling orders for Five Rivers and National Beef
would be filling orders for the same company - JBS
Brazil," Bullard claims. Bullard concluded this would
reduce the number of buyers for feeder cattle,
hurting demand.

First, detail errors: a) there is no such company as
"JBS-Brazil." JBS-S.A., based in Brazil, is the parent
company of JBS Swift, their American company; b) it
is not a proposed merger but a purchase of
Smithfield Beef and National Beef. Smithfield held a
half-interest in Five Rivers, a multi- yard feeding
company, with ContiGroup Companies holding the
other half.

Further, National owns no feedyards at all, has no
need for feeder cattle order buyers and, therefore,
its inclusion in the acquisition would have no direct
impact on the number of competing feeder cattle
buyers. While Five Rivers has common headquarters
management, it has managers with a degree of
autonomy at each feedyard. They also feed some
customer cattle, meaning some customers would
be sending their own feeder cattle or feeder cattle
purchased by themselves.

But the biggest fallacy in Bullard's claim involves
National Beef - a beef packing and processing
company - and USPB, a cattlemen's alliance. USPB is
an alliance of 29 qualified member feedyards
located in six different states and numerous
individual ranchers from around the country. USPB
owns a majority interest in National Beef and in the
purchase, would end up owning shares in JBS Swift.

But USPB would not be owned by JBS, the feedyards
are independent operators and procure feeder
cattle as they wish and the member feedyards have
sold only a part of their production to National. The
idea that JBS would "control" USPB and set up the
feeder cattle orders for all the USPB feedyards and
their rancher members is preposterous.

The facts are these:

USPB has averaged selling 12,000 head of fed cattle
per week to National (website figures).
USPB member feedyards have the capacity to
market over 40,000 head/week, meaning that
member feedyards sell lots of cattle to other
packers besides National. No more than 30 percent
of their capacity has been sold to National.
National, though still a relatively small packer,
slaughters three million head annually, meaning a
slaughter capacity of 14,000 hd./day -- it buys fed
cattle from many more than just USPB member
feedyards.
So R-CALF's contention that suddenly JBS Swift
would be consolidating ten percent of national
feeder cattle purchases under one office and
impairing demand and prices is totally incorrect as
regards USPB or National. And Five Rivers has not
been selling all its cattle to JBS Swift either, as
differences in cattle, feedyard location and plant
needs mean cattle go to different plants depending
on packer needs and bids. Cattle customers feed
may not be the type JBS Swift needs, either.

Bullard's contention that "in some, and perhaps
many, feeder cattle markets, this would
significantly reduce competition for a significant
number of feeder cattle," is farfetched, when
someone other than Five Rivers will buy some 92
percent of all feeder cattle. The USPB feeder cattle
will be bought by 29 separate feedyards or brought
in by some of the over 2,000 cattlemen who have
sent cattle through USPB. They would be connected
to JBS Swift only by a marketing agreement to be
able to sell a certain portion of the feedyards'
production to JBS Swift.

The majority of feeder cattle bought by USPB
member feedyards - at least 70 percent of their
capacity -- will have nothing to do with USPB at all.
The USPB qualified feedyards' one-time capacity is
over 800,000 head (website data).

Bullard's claim that the situation would harm feeder
cattle markets nationally appears factually
unsupportable.

We suspect that the Department of Justice, having
received Bullard's "evidence" and R-CALF having
"met personally with the agency to help it better
understand how the U.S. cattle market functions,"
will have difficulty reconciling facts with R-CALF
claims. Having seen Bullard's explanations of cattle
market functions, we suspect Justice already has a
much better understanding than R-CALF.

Again, R-CALF is not presenting facts and their
"evidence" doesn't exist.



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