JBS to open six beef processing facilities in Brazil

Brazilian meat producer JBS plans to open six processing facilities, which are expected to boost the company’s current beef production capacity in Brazil by 15%.

With this project, the company is trying to gain advantage of the grass-fed beef industry in Brazil and increase its market share, with beef producers in the US, Europe and Australia are reducing their production capacity due to high grain costs.

The six plants will increase the company’s processing capacity by 1.2 million cattle a year by July 2013, and about two million by the end of 2013, when the plants are expected to be fully operational.

Currently, the company slaughters about 12 million cattle every year.

The facilities will be located at Rolim de Moura, in the state of Rondonia; Nova Andradina in Mato Grosso do Sul; Pontes e Lacerda and Vila Rica in Mato Gross; Senador Canedo in Goiás; and Castelo dos Sonhos in Pará.

While three of the plants will be new, the other three are inactive facilities, which were acquired following JBS’s takeover of local poultry processor Independencia.

In April 2012, JBS acquired Independencia, which entered into bankruptcy as a result of the 2008 financial crisis.

Meanwhile, the company reported a profit of R$367m ($178m) for the third quarter of 2012, up from a loss of R$68m ($32.94m) in 2011, driven by the strong performance of its beef business and a weaker Brazilian currency.

Net sales increased 24% to R$19.4bn ($9.4bn), while earnings before interest, taxes, depreciation and amortisation soared 75% to R$1.38bn ($668.67m).

JBS, based in São Paulo, produces fresh, chilled and processed beef, chicken and pork, and also sells by-products from the processing of these meats.