Federal Legislation Would End USDA’s Bailout Payments to Brazil’s JBS

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On Tuesday, May 14, Congresswoman Rosa DeLauro (CT-03) filed the Buy American Agriculture Act (H.R. 2712) to stop the U.S. Department of Agriculture (USDA) from lining the pockets of global corporations at the expense of U.S. taxpayers and family farmers. The legislation was filed as the result of USDA’s announcement that it continues to provide millions of dollars in financial assistance to a Brazilian transnational corporation, JBS, through the bailout program established to assist America’s family farmers devastated financially by the U.S.-China trade war. A petition circulated by the Organization for Competitive Markets (OCM) in January calling on USDA and Congress to halt payments to the Brazilian behemoth garnered over 1,000 signatures in less than a week.

The new legislation would require that whenever possible, purchases of agricultural commodities and seafood made by the secretary of the U.S. Department of Agriculture (USDA) be from domestically owned enterprises. It would also require the secretary to publish the rationale for awarding the purchasing contracts and whether those enterprises are domestically owned.

Organization for Competitive Markets (OCM) issued the following statement:

“We applaud Congresswoman DeLauro for her prompt legislation, H.R. 2712. This legislation comes at a time when USDA, in the name of bailing out farmers harmed by the U.S.-China trade war, has already awarded over $60 million of U.S. taxpayer funds to one of the largest and most corrupt meatpacking corporations in the world, Brazilian-owned JBS. While America’s family farmers are financially being driven out of business, Secretary Perdue continues to provide financial aid to JBS, which in the last quarter showed a 116% profit increase with net revenues rising 11.5%. There is simply no evidence that financial aid USDA hands over to JBS finds its way down the supply chain to America’s farmers, rather it simply goes into the Brazilian corporation’s pockets. Congresswoman DeLauro’s legislation would end this insanity.”

Northwest Atlantic Marine Alliance (NAMA) issued the following statement:

“The USDA should make it a priority to buy seafood and agriculture foods from family farmers and fishermen domestically through its Food Purchase and Distribution program. At a time when our farmers and fishermen are barely surviving and multinational companies dominate our food system, this is a particularly important measure.”

Basis for Legislation

  • In November 2018, Chinese-owned Smithfield Foods rescinded its bid for bailout money after a backlash on Capitol Hill over a similar award, but neither JBS nor USDA would rescind their $22 million sweetheart deal.
  • This past week it was disclosed that Secretary Perdue had extended an additional $40 million in farmer trade bailout dollars to JBS.
  • In a decade-long scheme, the meatpacker bribed more than 1,800 Brazilian politicians, which JBS admitted helped them take over the U.S. beef market. In 2017, JBS was caught exporting rotten meat worldwide and trying to cover up the stench using cancer-causing acid products. In 2018, 12 million pounds of JBS ground beef were recalled and 246 people were sickened in the U.S. due to salmonella poisoning. Evidence shows the salmonella outbreak was caused by JBS’s standard practice of allowing sick dairy cows into the beef supply. In 2018, USDA found JBS had ripped off U.S. cattle producers at three separate slaughter facilities by shorting them on payments for their cattle, and while the JBS abuses were extensive, USDA settled the claims for a mere $50,000 penalty.
  • As reported by Reuters, JBS is making money off of the U.S. China trade war.
  • A Congressional Research Service report issued in December 2018 indicated 2018 net farm income was down 12% from the previous year. The calculations were inclusive of the farmer bailout payments which had been made due to the U.S. China trade war.
  • In spite of these massive payments for pork by USDA to JBS, U.S. hog farmers are still in what the Washington Post has called a tailspin.
  • Bloomberg reported last month that U.S. soybean growers are seeing the lowest commodity prices in a decade.

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Organization for Competitive Markets is a national membership-based research and advocacy organization working for open and competitive markets and fair trade in America’s food and agricultural sectors.

Media Contact:
Joe Maxwell
(573) 721-0927
jmaxwell@competitivemarkets.com

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