June 8, 2012 / 6:31 PM / 6 years ago

BREAKINGVIEWS-Brazil's meat champ gets rude welcome to big-time

(The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)

By Raul Gallegos

NEW YORK, June 8 (Reuters Breakingviews) - Brazil’s JBS (JBSS3.SA), now the world’s largest meat producer, is vowing to sue Greenpeace after the environmentalists accused the company of damaging the rainforest. The spat showcases the risks that can come from quickly scaling up to become a global player. It’s a coming-of-age moment of sorts for JBS.

The Sao Paulo-based company started as a local family slaughterhouse over a half-century ago but its growth has rocketed in recent years, including the acquisition of U.S. poultry giant Pilgrim’s Pride. Funded by state development bank BNDES, which now owns about 30 percent of the company, JBS fattened up its $1.5 billion of sales in 2005 to nearly $34 billion last year.

Such heft can’t hide under the jungle canopies of the Amazon. Emerging onto the world stage brings new scrutiny and demands from customers, shareholders and watchdogs on everything from corporate governance to workplace conditions. The attacks from Greenpeace build on tougher standards for bigger meatpackers. JBS, for example, is now expected to use GPS to vouch for its own quality standards as well as those of its suppliers.

Safeguarding precious lands is serious business, but activists like Greenpeace also like to advance their own causes by targeting the deepest pockets, especially with a big United Nations summit coming up in Brazil. The episode only supports the idea that JBS has achieved the global position it so avidly sought – and all that goes with it. Welcome to the big leagues.


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- Brazil’s JBS, the world’s largest meat company, said on June 6 it would sue environmental organization Greenpeace for what it called false claims that could cause it to lose business and hurt its image.

- The announcement came in response to a Greenpeace report on the same day that accused the company of breaking an accord that JBS and other Brazilian meatpackers signed in 2009 promising not to purchase cattle raised on deforested pastures.

- Greenpeace claims JBS had bought cattle raised on Indian reserves and other restricted areas. JBS said in a market filing that all the accusations Greenpeace had made against it in the report were false and “lead society to a false conclusion.” The report is part of an effort by Greenpeace and other environmentalists to highlight the role of food producers in the destruction of the Amazon rainforest in the run-up to Rio + 20, a United Nations summit to be hosted by Brazil starting on June 20.

    - The Brazilian meatpacker, once a family-owned slaughterhouse, grew into a global company in recent years following a string of mergers financed by Brazil’s state development bank.

    - JBS statement: link.reuters.com/zun68s

    - Greenpeace report: link.reuters.com/byn68s

    - Reuters: Brazil’s JBS says suing Greenpeace after report [ID:nL1E8H6E3P]

    - For previous columns by the author, Reuters customers can click on [GALLEGOS/]

    (Editing by Jeffrey Goldfarb and Martin Langfield)

    ((raul.gallegos@thomsonreuters.com)) Keywords: BREAKINGVIEWS BRAZIL/JBS

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