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JBS strategically restructured ownership of Five Rivers Cattle Feeding

Posted by: tdt -

By Bailey Naugle

    In a calculated move to cope with industry struggles and proposed legislation that would restrict packer ownership of cattle, JBS S.A. has divided the ownership of Five Rivers Cattle Feeding, with JBS USA retaining ownership of the 10 feedlots and J&F Oklahoma Holdings assuming ownership of the cattle.

    The restructuring agreement came shortly after Wyoming Senator Mike Enzi proposed the Livestock Marketing Fairness Act to the Senate. The legislation, which has been referred to the Senate Agriculture, Nutrition, and Forestry Committee, is intended to restore competitiveness in the meat industry by limiting meat packers’ ability to control market prices through ownership of livestock herds.

    Because JBS S.A. does own beef slaughter facilities throughout the United States, it is largely believed that the proposal of the bill significantly influenced the decision to disown the cattle of Five Rivers Cattle Feeding to avoid any legal complications in the future.

    Five Rivers Cattle Feeding is composed of 10 facilities throughout Idaho, Colorado, Kansas, Oklahoma and Texas, including three local feedyards: Coronado Feeders, XIT Feeders and Hartley Feeders, with a combined annual capacity of 1.5 million head.

    J&F has reportedly entered a three-year contract with JBS Five Rivers, and agreed to maintain at least an 85 percent capacity in the feedyards while paying a market-based fee per head per day for the care of their cattle.