WASHINGTON – US Sen. Chuck Grassley (R-Iowa) urged the antitrust division of the Department of Justice to investigate the proposed sale of Cargill Meat Solutions’ pork business to JBS USA. The transaction is valued at $1.45 billion.
In a letter to Assistant Attorney General William Baer, Grassley explained his concern that the deal could negatively impact competition within the pork industry. Iowa is a leading producer of pork in the United States.
|Sen. Chuck Grassley|
“I am concerned that continued mergers and acquisitions in an already consolidated pork industry will frustrate competition in the industry,” Grassley wrote. “Moreover, farmers could see their marketing options further reduced, especially in Iowa and Illinois where the Cargill processing plants are located.”
Grassley noted in a release from his office that the four largest pork processors will control roughly 71 percent of processing capacity in the US should the transaction pass regulatory scrutiny. He added that the sale of Cargill’s pork business would make JBS USA the second-largest pork processor with a daily slaughter capacity of approximately 83,000 head which equates to nearly 20 percent of US daily pork processing capacity.
JBS USA Pork, a unit of Sao Paulo, Brazil-based JBS SA, agreed to acquire Cargill’s US-based pork business earlier this month. The acquisition includes two Midwest meat processing plants, one in Ottumwa, Iowa and the other based in Beardstown, Ill. If approved, the deal also will net JBS five feed mills and four hog farms. Cargill said a DOJ review is routine.
“We’ve made the appropriate filings with the US Department of Justice, which is standard procedure for a transaction of this type,” Cargill spokesman Mike Martin said. “We look forward to their review.”