LA GRANDE - When JBS acquired Swift and Company in 2007 and renamed its North American operation JBS USA, the Brazilian company became the largest beef packer in the world, with plants in Brazil, Argentina, Australia, Italy and the U.S.
That move stirred controversy in the U.S. beef industry. Many feedlot operators and cow-calf producers worried that consolidation among packers would reduce competition for their product.
Chandler Keys, vice president of government and industry relations for JBS, spoke at the Cattleman's Workshop in La Grande in January about the company and the concerns raised by its entry into U.S. markets. JBS, Keys said, started in the 1950s in central Brazil, not far from the capital of Brasilia, when Jose Batista began slaughtering a few animals a day. The Batistas have three sons and three daughters, all currently involved in the company. About 15 years ago, under the direction of this second generation, JBS began to grow rapidly until it became the largest beef packing operation in Brazil and one of the largest beef exporters in the world.
As the Brazilian economy stabilized and the Brazilian real began to appreciate, JBS found itself losing money on exports. The Batistas responded by selling part of the company and using the proceeds to purchase packing plants in Argentina in 2005, when they also acquired the Swift name in that country.
When Swift USA came up for sale in 2007 the Batistas jumped at the chance. They moved their families to Colorado and plunged into the business of packing, selling and exporting U.S. beef.
"Who are these people? They are very hard working, a family-run company, and they like being in the meat packing business. I've been on the floor with Wesley Batista and seen him grab a knife from an employee and show people how to cut a flank steak. They are meat people, not bankers," Keys said.
Keys is not troubled by foreign ownership of U.S. assets.
"The good thing is that they are taking equity they built up in their country, bringing it to this country and putting it into an integral part of the economy, the food business," Keys said in an interview. He noted that Americans are not accustomed to foreign companies purchasing U.S. assets, but that is changing.
"It's the world economy. Equity flows where it's most efficiently used, and this family thought it would be best to come here. They want to be global leaders in the animal protein grade, and to be a global leader in any business you have to have a footprint in the U.S.," Keys said.
Keys emphasized the Batistas' understanding of the global beef market and their extensive experience with beef exports.
"Sixty percent of the beef in Brazil is exported. The Batistas are very internationally minded. They're willing to explore and figure out what people like to eat and how you can process it to get it to them," Keys said.
The Batistas helped modernize the Brazilian beef industry from being an exporter of one product, cooked canned beef, to one country, Great Britain, into an exporter of a variety of beef products around the world.