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A $1.3 billion dayGot an extra $1.3 billion lying around? No? JBS S.A. must have, because in less than 24 hours they announced the purchase of National Beef Packing Co., Smithfield Beef Group, and Australian beef packer Tasman Group. The purchase by the Brazilian company essentially means there are now three U.S. beef packers instead of four. JBS is the same group who purchased Swift last May and will now have close to 30 percent of the beef processing market share. Consolidation has long been a nasty word in the beef industry. Groups who long for the days of old think the word is the root of all evil. Others feel that the purchase will allow JBS to shut down plants and reduce capacity, an industry correction that has been needed for some time. No matter what you think, it can make beef producers uncomfortable. It seems that now, more than ever, is the opportune time to find alliances within the industry. Perhaps that means building an alliance to provide a certain kind of cattle. It might mean following a health system to improve the marketability of your stock. Maybe it is as simple as marketing your calves with your neighbor to make a load. Whatever it may be, we know one thing--times have changed. There is no longer a farmer on every corner and no longer is there a market for your cattle in every town. Is bigger better? Not necessarily, but what continues to be essential is to differentiate your product from the crowd. The industry up the chain has improved efficiencies and so must you. Successful businesses never sit still. They are always thinking, working and changing. Will that be you? Holly Martin can be reached by phone at 1-800-452-7171 ext. 1806 or e-mail at hmartin@hpj.com. 3/10/08 Date: 3/5/08
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