US - The announcement of JBS purchasing Cargill is behind us. That should put JBS in the #2 spot for packers, which is above Tyson. This also means that, between Brazil and China, they have control of about 50 per cent of the packing capacity in the US, writes Alan Bentley, Sales & Service, Genesus.
The packing industry has gone through many changes, one of the most important being the invention of refrigerated cars.
The plants were then able to move to where the livestock was produced and away from the cities. Boxed meat was the next change, which made swinging meat a term of the past and local butchers go the same way as makers of wooden wagon wheels.
Packing has always been an American Industry, and, similar to the pits closing in Chicago, this too is changing. I am guessing it is just not a glamorous enough business for American companies to look at.
The fact that foreign countries control such a large part of the pork industry should be beneficial to pork exports.
Like most government policies, it will take more time to develop than it should, but pipelines will develop to foreign markets.
The other side of the rope is always being pulled by the strength of our dollar. Exports are still driven by price or cost to the importing countries.
Slowly but surely these pipelines to China and other countries will win that tug of war to the pork Industry’s advantage. Passing TPP will also increase the amount of our pork being consumed overseas.
As for consolidation in the pork industry, I am betting this trend will continue into the future.
To find out more about Genesus Genetics, please take the time to visit their website at www.genesus.com .
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