Compelo Packaging - Latest industry news and analysis is using cookies

ContinueLearn More

JBS Intends To Enter Distribution With US IPO

Also aims to make the company less vulnerable to volatility

Brazil’s JBS, a beef processor, aims to improve its profit margins by investing in distribution with the planned capital its U.S. unit is preparing to raise in a public offering, reported Reuters.

Earlier, Joesley Batista, chief executive of JBS, said that the company’s plans were to expand into distribution also to make it less vulnerable to volatility.

Jeremiah O’Callaghan, director of JBS’s investor relations, told Reuters: “JBS is a company that has to grow more to achieve more synergies, to be a more efficient company, to be the big producer of protein and now the big distributor of protein too.”

JBS has the capacity to slaughter 73,900 head of cattle a day with 25 plants in Brazil, 16 plants in the United States, 10 plants in Australia, eight in Italy and six in Argentina.

The beef and grains specialist at agricultural analysts Safras e Mercado, Paulo Molinari, said: “If JBS is investing in distribution, it must see a big difference between the wholesale and retail price of beef and it wants some of that margin down the chain of production.”