Cattle Herds Grow After 70-Year Low, JBS Foresees Recovery
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U.S. ranchers are moving to expand their herds from a seven-decade low, paving the way for a long-awaited recovery in beef supplies, according to top producer JBS NV.
“We are into herd rebuild right now,” Wesley Batista Filho, CEO of the Brazilian company’s North American business, said in an interview. “The economic incentives are there, the weather is helping.”
That’s much-needed news for both meatpackers and consumers. A severe shortage in the world’s largest producer has sent cattle costs surging, wiping out billions in profits for companies such as JBS, Cargill Inc. and Tyson Foods Inc., while driving record beef prices at grocery stores.
JBS ranks No. 68 on the Transport Topics Top 100 list of the largest private carriers in North America. Tyson ranks No. 9.
RELATED:Tyson to Shut Kansas Plant as US Beef Shortage Erodes Profit
The move is backed up by a recent reduction in the number of female cows being sent to slaughter, which indicates more of them are being held for procreation, according to Batista. Still, it will take years for cattle supplies to recover, with no meaningful increase expected before 2027.
“It’s not ever going to be like taking the elevator. It will be more like taking the stairs,” he said.
Batista and other JBS managers took part in a bell-ringing ceremony at the New York Stock Exchange on June 25, where the company started trading earlier this month. The stock closed 0.4% higher at $13.87.
Batista said JBS has faced no disruptions from President Trump’s measures to restrict immigrant labor, which includes efforts to strip the legal status of hundreds of thousands of workers the meatpacking industry has heavily relied on over the years.
The company, which in May reached a union deal that secured “significant” wage increases, a paid sick leave program and a pension retirement plan for its workers, has seen no difficulty in attracting people to its production lines, Batista said.
“You put all those things together, it’s a good job to have in the communities where we are,” he added.
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