JBS Gains Entry To Top Markets In U.S., Asia

US - The sale of Swift & Co. to São Paulo, Brazil-based JBS SA will allow the South American meat company to take advantage of the reputation American beef has globally.
calendar icon 31 May 2007
clock icon 2 minute read

JBS, founded in 1953, is already the largest beef processor in Brazil.

Acquiring Swift is a major step in establishing a global presence for the Brazilian company, JBS chief executive Joesley Mendonça Batista said in a statement.

The deal gives JBS quick entry into premium markets, said Wendy Voss, a Sydney, Australia-based analyst at Rabo bank Group.

"North America and North Asia are the prized markets for the beef industry around the world," she said.

There have been periodic bans on exports of Brazilian beef in recent years because of fears over hoof-and-mouth disease, said John Nalivka, owner and president of Sterling Marketing, a Vale, Ore.-based consulting firm.

"I think most of the companies in Brazil have made no secret that they're looking to expand their global reach. For a strategic move, JBS had to do it," Nalivka said. "The U.S. has the distinctive competitive advantage in the world with high-quality, grain-fed beef. Anybody that wants access to that market, they have to have access to a U.S. company."

This is not JBS's first foray into the U.S. market. In January, the company acquired meat distributor SB Holdings, which has operations in Connecticut.

But the purchase of Swift gives JBS solid footing in the U.S. market and access to facilities that have the capacity to slaughter 5,500 cattle a day. JBS currently has the capacity to process 800 to 1,600 cattle daily.

Source: Denver Post

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