JBS dramatically cuts beef production in Brazil after importers cut purchases

Source: meatingplace.com

By Anna Flávia Rochas on 3/24/2017

JBS S.A. decided to suspend operations in 33 out of 36 beef slaughter plants in Brazil for three days beginning Thursday, after more than a dozen countries temporarily banned Brazilian meat imports this week, the company announced on Thursday.

“In the next week, the company will operate all its units with a reduction of 35 percent in production capacity,” JBS added in a statement.

The company aims to adjust production to demand as a consequence of the embargoes imposed by importers, after the country’s Federal Police announced an operation to dismantle an alleged bribery scheme involving 33 federal sanitary inspectors and 21 meat processing plants.

JBS added that “it is committed to maintaining the employment of its 125,000 employees throughout Brazil.”

Since the investigations were announced last Friday, Brazil’s daily meat exports fell to $74,000 on Tuesday from an average of $63 million before the probe was made public.

China, Hong Kong, Egypt and Chile alone, which are among countries that temporarily banned purchases from Brazil, account for 53 percent of the country’s total beef exports, according to data compiled by BTG Pactual bank, released in a report on Thursday.

The USDA’s Food Safety and Inspection Service decided to increase its testing on all shipments of raw beef and ready-to-eat products from Brazil, even though none of the slaughter or processing facilities implicated in the investigation have shipped products to the U.S.

Congresswoman Rosa DeLauro (D-Conn.) on Wednesday urged the USDA to suspend all imports of Brazilian meat until agency officials can guarantee the products are not adulterated, mislabeled or expired. On Tuesday, Senator Jon Tester (D-Mont.) announced legislation to temporarily ban importation of Brazilian beef for 120 days, which would give time for the USDA to investigate potential food safety threats.

The Brazilian government and meat industry associations have been trying to publicly assure importers and local consumers that Brazil’s federal sanitary inspection system is rigid, and that the investigations do not question quality of the meat.

“The investigation is not about the quality of the products, the investigation is about the conduct of people,” Agriculture Minister Blairo Maggi said in a conference call with foreign journalists posted on Facebook Thursday.

Brazil’s Federal Police said in a joint statement with the Ministry of Agriculture that the Operation Weak Flesh finds punctual irregularities in the federal sanitary inspection, which relate “directly to deviations of professional conduct practiced by some servers and do not represent a generalized malfunction of the Brazilian sanitary system.”

The Brazilian poultry and pork industry association ABPA said on Thursday that the events investigated by the Federal Police were isolated, and “the idea of systemic problems in the quality of Brazilian meat is absolutely wrong.”

Brazil’s Minister of Agriculture Maggi visited BRF’s processing plant in Rio Verde (Goiás state) on Thursday with two TV crews from China, as part of the government’s efforts to guarantee the quality of Brazilian meat and sanitary procedures.

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