BRASILIA (Reuters) – Brazil’s antitrust regulator Cade on Thursday opened an investigation into meatpackers JBS SA and BRF SA, according to a decision signed by the agency’s superintendent.
The decision said it launched the probe based on an article in Brazilian newspaper Valor Economico that describes executives of the two companies saying in an event in Sao Paulo on Wednesday that they would have to pass through a 30% rise in corn costs to chicken prices.
Reuters was present at the event and witnessed the remarks by JBS chief executive Gilberto Tomazoni and BRF CEO Lorival Luz.
Tomazoni stated that corn prices have risen sharply in Brazil, due to strong demand for exports and ethanol. Corn represents the largest cost on chicken meat.
BRF did not immediately comment on the matter. JBS said JBS said it had not been informed of the investigation and rejected any allegations of cartel practices.
Reporting by Ricardo Brito and Alberto Alergiri; Writing by Jake Spring; Editing by Chris Reese and David Gregorio