US poultry must rise to Brazilian competition, says panel

NCC panel: Brazil has unique advantages.

Brazil’s poultry industry will continue to challenge U.S. producers in markets at home and abroad, and the U.S. poultry industry needs to rise to the competitive challenge, said a panel of executives at the National Chicken Council (NCC) annual meeting.
Top executives of the three largest U.S. chicken companies said Brazil’s proximity to huge grain supplies will continue to drive that industry’s reach into global markets, including the U.S. market. The U.S. industry, they said, needs to learn how to compete with that challenge and must work politically to fend off a growing regulatory burden that threatens its competitiveness.

Tyson CEO warns about U.S. ‘regulatory overreach’ 
Tyson Foods CEO Donnie Smith said, “The reason the Brazilians and others are interested in the U.S. market is that this is a great market and still the world’s leading economy. It’s a great place to do business, and we don’t need to lose our competitiveness as an industry.”
Smith expressed concern over U.S. competitiveness in light of “regulatory overreach” which he said is “driving costs into the U.S. industry without providing a requisite value back for consumers.” If allowed to continue, he said, this will lead to the U.S. industry being less competitive globally.

Brazil positioned for continued success, says Perdue president 
U.S. producers have the home-field advantage of producing for the world’s leading poultry market, but the Brazilians enjoy cost advantages that will be difficult for the U.S. to match.
Mike Roberts, president, food products business for Perdue Farms, said, “Brazil is going to be a factor globally. They can produce five crops of grain in two years, while U.S. farmers can at best produce three, most of the time two. Brazil will continue to be a factor, and we will have to learn to how to compete with them.”

U.S. can learn from Brazilians, says Jackson 
“The reality is that Brazil is in a unique position relative to the world’s meat supply, both in chicken and beef. There will continue to be Brazilian companies with interest in [producing and selling] chicken outside of Brazil,” said Don Jackson, CEO, Pilgrim’s Pride.
Jackson, whose company was acquired in 2009 by Brazilian meat and poultry producer JBS, S.A., said Brazilian companies bring a focus on costs and efficiency from which U.S. companies can learn.
“The Brazilian approach to this business has been very successful and brings a level of efficiency that in some respects we have ignored in the U.S. industry over the last several years. We’ve been successful, in some respects, in spite of ourselves. I think that the Brazilian approach to the meat business will allow us to reexamine how we approach the business,” he said.

Listen online 
Hear a podcast of the comments by Smith, Roberts and Jackson in a question-and-answer session at the National Chicken Council (NCC) annual meeting in Washington, D.C. The podcast is accessible online.  
Also participating were Jerry Lane, president, Claxton Poultry; and the panel moderator, Bill Lovette, president and COO, Case Foods.
Video interviews with panelists Don Jackson, Mike Roberts and Bill Lovette can also be viewed online.