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Cattle Herds Grow After 70-Year Low, JBS Foresees Recovery
U.S. ranchers are beginning to increase their cattle herds, moving away from a historically low level. This shift is expected to lead to a gradual recovery in beef supplies, significant for both consumers and meatpackers like JBS, which is the largest beef producer. CEO Wesley Batista Filho noted that improved economic conditions and favorable weather are supporting this herd rebuilding, despite the challenges posed by previous shortages that have drastically raised cattle prices and hurt profitability for major companies in the industry.
The reduction in the number of female cows sent to slaughter highlights this recovery effort, as more are being retained for breeding. However, Batista cautioned that it may take years to see a substantial return to former cattle supply levels, predicting that significant increases will not materialize until after 2027.
Despite broader labor challenges in the industry, JBS has managed to attract workforce participants due in part to better wages and benefits secured through a recent union deal. This makes positions in their plants more attractive to local communities.
In terms of transportation, the rise in cattle production and subsequent beef supply recovery will necessitate careful consideration of logistics and distribution networks. An increased cattle herd means heightened demand for transportation services to move cattle to market and process them efficiently. Companies like JBS, ranked among the largest private carriers, will need to optimize their supply chain operations to meet this demand while also navigating potential regulatory challenges in transportation, including labor availability and compliance with changing policies. Ensuring a robust and efficient transportation infrastructure will be essential to support this gradual recovery in the beef supply chain.
The reduction in the number of female cows sent to slaughter highlights this recovery effort, as more are being retained for breeding. However, Batista cautioned that it may take years to see a substantial return to former cattle supply levels, predicting that significant increases will not materialize until after 2027.
Despite broader labor challenges in the industry, JBS has managed to attract workforce participants due in part to better wages and benefits secured through a recent union deal. This makes positions in their plants more attractive to local communities.
In terms of transportation, the rise in cattle production and subsequent beef supply recovery will necessitate careful consideration of logistics and distribution networks. An increased cattle herd means heightened demand for transportation services to move cattle to market and process them efficiently. Companies like JBS, ranked among the largest private carriers, will need to optimize their supply chain operations to meet this demand while also navigating potential regulatory challenges in transportation, including labor availability and compliance with changing policies. Ensuring a robust and efficient transportation infrastructure will be essential to support this gradual recovery in the beef supply chain.
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