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The Beef Angle

Beef Briefs: JBS Buys; Steve Hunt; Johne's Disease

JBS will acquire XL Foods plants in Alberta; Steve Hunt is stepping down at U.S. Premium Beef; and, Cornell receives a grant to study Johne's Disease.

A good blogger should be something of a curator for his readers, gathering and analyzing important news stories and items of interest for the reader. Be on the lookout for regular updates of that sort here under the heading "Beef Briefs;" I'll provide you a synopsis of the story, a link to the source material and some pithy comments on what the story might mean to you.

Here's what came across my radar this morning:

JBS plans XL acquisition Jan. 14

My Feedstuffs colleague Rod Smith reports that one of the largest beef producers on the planet will exercise its option to acquire beef packing facilities owned by XL Foods in Alberta, Canada. The deal, worth $100 million in cash and stock, will add at least 5,000 head of daily processing capacity to JBS' North American operations via plants in Brooks and Calgary.

JBS will also acquire a feedlot in Brooks, as well as a 6,600-acre farm attached to that feeding facility. During a regulatory review period, the JBS will continue to operate the XL facilities in the U.S., pending approval to exercise its purchase of those facilities, as well.

XL came under the microscope last year after a case of e.coli contamination led to the largest beef recall in Canada's history.

Once the acquisition is completed, JBS' position in the U.S. beef market will have changed considerably. Prior to the deal, JBS was the third-largest beef packer, behind Cargill (30,000 head per day) and Tyson (28,900). Once the sale is closed, JBS will have surpassed both, with processing capacity of 31,050 head per day.

Hunt stepping down from USPB

Steve Hunt, president and CEO of U.S. Premium Beef, announced he would step down as head of the company at month's end, remaining in an advisory capacity. He will be succeeded by the firm's chief operating officer, Stan Linville.

Credited with "visionary leadership" that led USPB to become one of the leading premium-based buyers of cattle in the country, Hunt spearheaded the development of USPB's grid-based marketing system that awards premiums for age and source verification and other quality measurements.

More than 1,400 feedlots in 14 states have marketed cattle to USPB since 1997, and last year USPB cattle averaged $55.66 per head in premiums over the cash market.

Cornell receives grant to continue Johne's Disease studies

Johne's is one nasty bug, any way you slice it. While perhaps more recognized among dairy producers as a major profit-robber, the disease is certainly no less important of a concern to a cow-calf producer. Researchers at Cornell University have received a $500,000 grant to continue studying the disease, and though their efforts are currently focused on bacteria transmitted in fluid milk production, the implications could bear meaning for bovine health in general.

Later this week we'll discuss the latest news in the animal rights universe, and how allegations of animal abuse turned into a real legal circus for one of the nation's most well-known animal advocacy organizations. Stay tuned.

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