Brazil’s JBS S.A., the world’s largest meat-processing company, reported a sharp drop in net profits for the second quarter of 2017. According to the meat-industry website MeatingPlace.com, the company reported a drop of approximately 80 percent in net profits from the same quarter last year.
JBS Mercosul, the unit in charge of beef operations in Brazil, Argentina, Paraguay, and Uruguay, saw more than a 14 percent drop in revenue with a 21.9 percent drop in volume sold. And the net revenue for the company’s processed-foods unit, Seara, fell 6.1 percent.
The company reported that the decrease in profits is the result of lower sales from their processed-foods and Latin American beef units. But this is only part of the story.
Earlier this year Brazilian police raided more than a dozen meatpacking plants. Dubbed “Operation Weak Flesh, the investigation revealed more than 40 incidents of meatpackers bribing politicians and inspectors to overlook unsanitary conditions and hazardous practices, including processing rotten meat. Police found that pigs’ heads were crushed and mixed into sausages, cardboard was mixed with chicken meat, and chemicals were injected into meat to hide the smell of rot. Federal officials also found that some companies had manipulated certificates for export to countries such as Spain and Italy. JBS S.A. was one of the companies investigated, and it’s been confirmed that two of the company’s executives were arrested in the scandal.
In the two weeks following the scandal, JBS S.A.’s beef production declined more than 35 percent, and the company suspended 33 of its 36 beef slaughter plants for three days. Several countries immediately implemented trade bans with Brazil’s meat industry, including some of its biggest importers. According to Brazilian financial company BTG Pactual, China, Hong Kong, Egypt, and Chile account for a staggering 53 percent of Brazil’s total beef export. The first day of the ban, Brazil’s daily meat export fell from an average of $63 million to $74,000.
This huge scandal points to a culture of corruption in Brazil’s meat industry. But it’s the animals who are made to pay the ultimate price. Not only are they all violently slaughtered; the majority of them suffer their entire lives in filthy and cruel factory farms.
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