JBS: Outsized Deforestation in Supply Chain, COVID-19 Pose Fundamental Business Risks Chain Reaction Research is a coalition August 2020 of Aidenvironment, Profundo and The Brazilian company JBS SA is the largest meat processor in the world based Climate Advisers. on sales. The company operates five main business units: JBS Brazil, Seara, JBS USA Beef, JBS USA Pork, and Pilgrim’s Pride. This paper assesses the Contact: deforestation exposure and the physical and transition risks from JBS’ www.chainreactionresearch.com; operations in Brazil. CRR has located and monitored 983 direct suppliers and
[email protected] 1,874 indirect suppliers to JBS in six Amazon states. In addition, CRR calculates the revenue and EBITDA impact of deforestation, Chinese demand, and COVID- Authors: 19 in three forward-looking scenarios. Tim Steinweg, Aidenvironment, Gerard Rijk, Profundo Key Findings: Matt Piotrowski, Climate Advisers JBS has a growing presence in the Chinese market. China accounted for With contributions from: 26.1 percent of JBS’ global exports in 1Q20 and 33.4 percent in 2Q20. The Jack Cunningham, Aidenvironment company has benefited from the growing Chinese reliance on meat imports Barbara Kuepper, Profundo after the African Swine Fever reduced the country’s pig herd. Since 2016, JBS has expressed intentions to list its international assets in the United States. The U.S. listing would consist of a spin-off of JBS’ international operations into a separate company with the same shareholders. Simultaneous to the U.S. listing plans, JBS’ second-largest shareholder BNDESPar announced its intention to sell half its shares. JBS’ beef operations in Brazil have an outsized deforestation risk exposure.