January 22, 2014

After purchasing Pilgrim’s Pride in the U.S. five years ago, JBS Group began turning its attention toward Brazil’s poultry and pork sectors.  The latest in a string of acquisitions, JBS has bought Seara, Brazil’s third largest chicken exporter for $3 billion from Marfrig.  In 2013 JBS also took over Brazil’s fourth largest chicken exporter, French-owned Doux as well as two smaller companies.  All told, JBS has acquired 20 processing plants and distribution facilities as well as several brand names.  Many of these acquisitions were the result of forced divestment enforced by Brazil’s regulatory body, Cade to allow for greater competition, or sell-offs as the result of companies making several acquisitions and then not being able to digest or synergize those acquisitions.  The industry has faced its share of problems and challenges over recent years.  The rise in value of the Brazilian real, the sharp rise in the price of corn and soy meal, and the rise in the cost of labor and logistics have all contributed to the increase in cost of poultry meat cooling both domestic and overseas demand.  Given these conditions and the arrival of JBS to the Brazilian poultry meat industry, companies are maneuvering to gain advantage in an increasingly competitive market.

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