Administration of Trade Relief Funding Criticized Over Sizable JBS Award

Brian German Agri-Business, Funding

The U.S. Department of Agriculture (USDA) has received criticism for how trade relief funding is being awarded, due to some recipients having strong business relationships with other countries.  JBS USA, the American subsidiary of the Brazilian meat company JBS SA, has been a significant point of contention.  A recent analysis from the Midwest Center for Investigative Reporting revealed that JBS USA received more than 26 percent of the $300 million that was allocated for pork. 

trade relief fundingA group of nine U.S. Senators sent a letter to U.S. Secretary of Agriculture Sonny Perdue back in May, criticizing the agency’s administration of the trade relief funding.  The lawmakers pointed out that the USDA’s Trade Mitigation Program is designed to assist U.S. producers who are struggling as a result of the current trade environment.  JBS USA has been the single largest beneficiary of the program, being awarded nearly $78 million in pork contracts.

“It is counterproductive and contradictory for these companies to receive assistance paid for with U.S. taxpayer dollars intended to help American farmers,” the letter stated.  “It is unacceptable that American taxpayers have been subsidizing our competitors through trade assistance.  We ask that you ensure these commodity purchases are carried out in a manner that most benefits the American farmer’s bottom line – not the business interests of foreign corporations.”

Secretary Perdue was asked about the trade relief funding that was awarded to JBS USA while he was at the recent AgTech Summit in Monterey.  The Secretary highlighted the fact that while JBS is an international company, it has several plants here in the U.S. which purchase a substantial amount of beef and hogs from American producers.

“We bought protein from them that was produced by U.S. producers there and took it off the market to support the prices,” Secretary Perdue noted.  “We can’t buy from every swine farmer there and that’s not the way it’s done.  Those hogs are contracted with different companies to do that.  So, the function, the beneficiary here was not JBS, it was the American hog farmer and that was our intention and yes, we would do that again.”

JBS has expanded significantly in the U.S. over the past ten years, purchasing Smithfield Beef Group, Inc., Cargill’s pork business, National Beef Packing Co., and Pilgrim’s Pride.  The JBS facilities that were awarded trade mitigation contracts from the USDA are in California, Iowa, Minnesota, and Illinois.

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Brian German

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Ag News Director, AgNet West