BRAZIL
THE OVERNINGHT SUCCESS, THAT WAS 55 YEARS IN THE MAKING.
JBS-SWIFT (Jose Batista Sobrinho founder of JBS in 1953.)
The meat industry if full of legends and remarkable men, one can go back 150 years to Gus Swift, the founder of Swift and company or more recently, 55 years ago to Jose Batista, the cattle dealer who founded JBS SA, in a small beef plant in Goias, Brazil.
The Liebig family from the East End of London, who founded the Fray Bentos, Oxo, and Bovril, brands of beef extract and corned beef, in the town of Fray Bentos in Uruguay in 1865.
One of their (Brooke Bond Liebig) products, could be found in every household in Great Britain and the Commonwealth for over 100 years, Fray Bentos corned beef fed the Allied Troops, through two world wars, gravy could not be made without an Oxo cube.
Most of Leibig’s operations were in fact done in the City of Enre Rios, across the River Plate in Argentina. The beef industry in Entre Rios is today controlled by JBS-SWIFT.
The main beef packing company with most modern plant in Argentina, is Armour-Swift in Rosario, Santa Fe, with capacity for 1500 cattle per day. This company took control of the corned beef and beef extract business, when Liebig’s left Argentina in 1974 and today is owned by JBS-SWIFT.
The Vestey Organization from England and controlled by Lord Vestey, was the worlds largest beef and lamb producer for over 90 years. The operations were on three Continents, the Vestey Flagship beef plants at Townsville and Rockhampton in Queensland Australia, are today owned and controlled by JBS-SWIFT.
Smithfield Foods Inc, in the United States are the biggest pork producers in the USA and one of the biggest in the world, today, they are owned by JBS_SWIFT.Swifts USA, was purchased by JBS SA, in July 2007 and today the two names are one, combining over 200 years of meat industry tradition, forming JBS-SWIFT.
The name today everyone recognizes is JBS-SWIFT. Their purpose built, state of the art beef plant at Beef City, in Queensland Australia, is the finest plant in the country and complimented with a feed-lot to finish their own cattle.
The company is today headed by the son of the founder, Joesley Batista, who at the age of 36, as the company CEO, controls 10pc of the worlds cattle that are slaughtered for beef.Joesley has worked on the slaughterhouse floor from being a teenager, in the same manner as the late Lord Vestey, sent his two sons Sam (the current Lord Vestey ) and Mark, to learn their trade on the kill floor of his New Zealand lamb plants and Argentine beef plants, working on the chain with the men.
The Batista family, have spent a staggering US$1.75 billion in the last year picking up companies from Australia to the USA and now have 120 establishments, processing beef and pork worldwide.
Jose Batista the founder, realized that the live trade was coming to an end in 1953, when he bought his first beef plant and made the transition from live animals to beef.
This is a very similar story to that of Larry Goodman, the founder of the AIBP Group, based in Ardee Ireland, who are today the biggest beef processors and traders in Europe.
The Bastista family, like the Goodman family are very hands on, know their livestock and their markets and have kept the most wonderful sense of humility.
JBS-SWIFT will turnover US$25 billion this financial year, which is an 10 fold increase from 2006.
In June of this year the family raised US$2.54 billion on a private share sale in the company and their track record in acquisitions has been quite remarkable, cashing in on the Argentine crisis in 2002, picking up companies for their tax debt and generally being alert to a good bargain.
The first quarter of 2008,saw a company loss of US$3.73 million, caused in the main by to economic slowdown, in the US and the ban on Brazilian beef along with export restrictions in Argentina.
When Roger Fletcher built the worlds largest sheep plant, in Dubbo NSW, Australia, in 1987, it was at a cost of US$11 million, a staggering figure in those days.
Roger had started out in life as a sheep drover, taking sheep from town to town in outback New South Wales.
At the opening of the plant a journalist asked one of the directors of ANZ Bank, if the bank were afraid of the risk factor, the banker replied "were backing the man", today Fletcher International, is the worlds biggest sheep operation and Roger can be found at the plant most mornings.
When Joelsley Batista purchased Swifts in Greeley Colorado, Swifts were 10 times the size of JBS, Joesley arrived at the plant one morning at 4 am and noticed trucks going out only half full of meat, the reasoning given was that it was to ensure everyone got their beef on time and early.
He called the men together and said "from today, no truck leaves the yard unless it is full, we are here to make money not to look nice".
JBS-SWIFT are seeking more acquisitions in Australia and Brazil and are interested in the European market in the not to distant future.
The company opened JBS Bank in July of this year, offering US$4 billion in loans to farmers, who wish to enter into or extend current beef fattening farms.
The banking service will be extended to Europe and Australia by 2009.
The company has increased beef yields in Australia by 2%, by improving the production lines and incentives to production workers.
The recent acquisition of National Beef and the Smithfield Beef Group in the USA, for US$600 million, will make JBS-Swift the largest beef packers in the USA and the largest beef packers in the world, processing 10% of the worlds cattle.
The company is now the largest beef packer in Australia since the acquired Tasman Meats and handle 21% of Australia’s beef production.
Perhaps the best deal to date of JBS, was the purchase of CEPA in Argentina which consisted of two of the largest beef plants in the country with capacity for 15,000 cattle per week.
The company was taken over by a financial creditor in 2003, after trading difficulties and JBS picked the whole enterprise up for a deal with the Argentine government tax office, in return for a percentage of back taxes,
One of the plants was opened by the president of Argentina Christina Fernandez de Kirchner in July. This meant 500 jobs in one of the poorest districts of Buenos Aires, the staff were already trained, it was an everybody wins situation.
It is rumored that JBS-Swift have an interest in two additional plants in Australia, one in Western Australia and one in Queensland.
