Senator pushes for scrutiny of proposed JBS-Cargill deal

Sen. Chuck Grassley, R-Iowa, has sent a letter to the U.S. Department of Justice pressing theAntitrust Division to review JBS USA’s proposed acquisition of Cargill Inc.’spork unit.

Sen. Chuck Grassley, R- Iowa, has sent a letter to the U.S. Department of Justice pressing the Antitrust Division to review JBS USA’s proposed acquisition of Cargill’s pork unit.

The two companies announced the proposed transaction, valued at $1.45 billion, on July 1.

Grassley expressed concern that the merger will increase concentration and decrease competition in the U.S. pork industry. 

“If the JBS-Cargill deal is finalized, the four largest pork processors will control roughly 71 percent of the processing capacity in the country. Continued mergers and acquisitions in an already consolidated pork industry could reduce competition. And, reduced marketing opportunities for farmers and independent producers, and the subsequent impact it could have on pork prices for consumers is of great concern,” said Grassley. 

JBS USA and Cargill Inc. are currently the third and fourth largest U.S. pork processors respectively.  If the transaction is finalized, JBS USA will become the second largest pork processor with a daily slaughter capacity of around 83,000 head. This equates to nearly 20 percent of U.S. daily pork processing capacity, Grassley said.

   

Both companies have plants in the state Grassley represents. JBS USA has a plant located in Marshalltown, Iowa, and Cargill has a plant located in Ottumwa, Iowa. 

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