US cattle farming lobby group R-Calf and the Organisation for Competitive Markets (OCM), have filed joint litigation in the US District against the proposed acquisition of National Beef Packing Co by JBS.
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The US Department of Justice, along 17 state attorneys general, also filed litigation to block the JBS merger.
Last month the US Department of Justice moved to block the proposed US$970m deal over fears it would hit competition in the sector, lead to higher prices for consumers and reduce the prices paid to suppliers.
According to the DoJ, if the deal were to go ahead, the top three US beef packing companies would control approximately 85% of the market.
“We believe our involvement will assist the government’s case because we can fully represent the views and competitive concerns of farmers, ranchers and feeders who are most affected by this merger,” said R-Calf CEO Bill Bullard.
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By GlobalDataR-Calf and OCM have collaborated since March to encourage the Justice Department and numerous state attorneys general to take enforcement action, not only against this particular acquisition but also JBS’ recently approved purchases of Smithfield Beef Group (Smithfield) and Five Rivers Ranch Cattle Feeding (Five Rivers).
“Because of the profound impacts this proposed merger would have on US cattle producers, the thousands of domestic cattle farmers and ranchers cannot be sideline observers in this historic lawsuit,” Bullard said. “Even without the Smithfield and Five Rivers components, this is the largest and most compelling merger ever contemplated in the US cattle industry and it would radically restructure the US cattle markets.”
OCM executive director Fred Stokes added: “Our industry needs more competition, not more concentration, and our lawsuit is an important step in stopping ongoing concentration so we can soon focus on rebuilding the competition we’ve already lost.”
