A coalition of 72 groups including cattle producers, consumers and religious leaders are urging the U.S. Department of Justice to block JBS S.A.'s purchase of National Beef Packing Co. and the Smithfield Beef Group and Five Rivers Ranch Cattle Feeding.

The signatories of a letter to the DOJ asserted that the deal, which would make JBS-Swift & Co. the largest meatpacker in the United States with control of some 32 percent of the industry's slaughter capacity, would eliminate two national buyers and "harm price, choice, innovation and competition in the beef industry."

In announcing the proposed acquisitions, JBS S.A. President and CEO Joesley Batista acknowledged that controlling 32 percent of commercial slaughter capacity "is a big position," but contended the acquired assets give U.S. farmers more plants to which they can sell their cattle.

"With this combination, if you look locally, we do not have a big concentration in those states," he said. "For example, the Smithfield beef plants are completely in another region than [those of] National Beef. We are confident this deal will be accretive to farmers."

The DOJ declined to comment on the JBS deal and a timetable for its decision. "All I can say is that the Antitrust Division is investigating the proposed transaction," spokesoman Gina Talamona told Meatingplace.com.

By Tom Johnston on 3/26/2008 for Meatingplace.com