State Attorney Generals Asked to Investigate JBS

Groups say current cattle market is already suffering from reduced competition.

Published on: May 2, 2008

R-CALF USA and the Organization for Competitive Markets have requested that the attorneys general from 13 major cattle-producing states conduct an investigation of the competitive effects of the proposal by JBS S.A. to acquire National Beef Packing Co. and the beef division of Smithfield Foods Inc.

"The primary focus of our concern is with the market for slaughter-ready cattle that are sold in proximity to the major meatpackers and the market for lighter-weight feeder cattle that are sold in relatively large quantities in every state of the Union," wrote R-CALF USA President/Region VI Director Max Thornsberry. "We also note that reducing the number of major beef processors from five to three is likely to have adverse competitive effects on consumers as well."

The letter went on to say that past packer merger approvals have had destructive results for independent livestock producers such as the 90% reduction of U.S. hog producers. They urged action, stating that competition is the best regulator.

To view a copy of the letter, visit the "Competition Issues" link at www.r-calfusa.com.