Given the management of Minerva Foods to buy the meatpacking plant of Breeders & Packers Uruguay (BPU), the two main agricultural unions, the Rural Federation (FR) and the Rural Association of Uruguay (ARU), expressed their concern about what could be a concentration of national work between two multinational firms: Minerva Foods and Marfrig.
“If at one point we were worried because 60% of exports all went to China, now we have to worry that 55 or 65% of the work remains in the hands of two companiesbeing (beef) the main export product of the country”, said the president of the RF, Martín Uría, in Valor Agregado of radio Carve.
As he commented, the sale of the company generates concern and expectations, and the union’s position is that it is an issue that must be paid attention to, “not only as a productive sector, but as a country.”
“Uruguayans have a bad experience of what monopolistic companies mean for consumers, when we see state companies, when this type of thing begins to occur, they begin to worry,” he stressed.
On the other hand, the president of the ARU, Gonzalo Valdés, declared in that same medium that the issue was discussed in the union and It was agreed to carry out an analysis and monitoring of the work to see how the purchase of the refrigerator could affect its compositionand the impact that may have.
“Obviously it puts us on alert,” because “something that is not convenient could be generated,” said the union director and livestock producer, who stressed that the ARU will not venture a position without analyzing the situation.
The government’s word
Minerva Foods already has three refrigerating plants in Uruguay (Carrasco, Canelones and PUL) and, according to the economic newspaper Valor, signed an exclusivity agreement with the Japanese company NH Foods to negotiate the purchase of BPU refrigerator, which is in Durazno. This plant has a slaughter capacity of 1,000 heads per day.
Although the purchase values have not yet been defined, Valor reported that the business should be done for an amount between US$35 million and US$45 million.
The Minister of Livestock, Agriculture and Fisheries (MGAP), Fernando Mattos, said at a press conference that once the deal is finalized, it will be necessary to see that all the corresponding authorizations are given to the Competition Defense Division, since ” there may be a concentration of demand”, which could operate as a “distortion factor” in the price of fat farms.
“These two companies (Minerva Foods and Marfrig), which are major global players in the production of animal protein, have made significant investments in Uruguay, but depending on their expansion plans, they may mean that 60% of the work is concentrated in two companies”, he indicated and maintained that the ministry must evaluate if the effect of the concentration of the work is “excessive” or not and if it can impact the formation of prices.
