The U.S. Justice Department will not block the purchase by JBS of two U.S.-based XL Four Star Beef plants. R-CALF USA CEO Bill Bullard tells Brownfield Ag News that the acquisition will hurt competition for cattle.
“We are very concerned because JBS already controls a dominant share of the marketplace,” said Bullard. “Allowing them to gain even more slaughter capacity will further reduce competition and hurt the U.S. cattle industry.”
The plants, one in Omaha, Nebraska, and another in Nampa, Idaho, both of which primarily process cull cows, are owned by Canada-based XL Four Star Beef. Although JBS has extensive U.S. operations, the company is headquartered in Brazil, and Bullard has concerns about its foreign ownership.
“In the event that JBS wanted to leverage down U.S. prices by sourcing livestock from the other countries in which they operate, they would have the market power to actually manipulate prices by lowering them for domestic producers,” he said.
When the merger is complete, JBS will have a slaughter capacity in the United States of approximately 28,500 head per day, according to R-CLAF USA, which the organization says will make it the largest beef packer in the United States and in the world.
Officials at JBS’s Greeley, Colorado office declined comment and XL Four Star Beef officials were unavailable to comment.
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