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Is the tail wagging the dog at JBS USA?

JBS USA announcement on ractopamine is an effort to get a corner on the China trade.

JBS Swift recently announced the hogs they slaughter and further process would no longer have been supplemented with ractopamine.

Ractopamine is a chemical falling in the beta-agonist class that is used in cattle, swine and sometimes turkeys to promote weight gain in the form of leaner muscle meat.

But, first of all, a couple of disclosures:

  1. I consulted at Elanco for several years after my time at the U.S. Department of Agriculture. One of the things I was tasked with was chairing a committee of experts to produce a paper on ractopamine in anticipation of using it to get the Codex Alimentarius Commission to establish Maximum Residue Limits in meat for ractopamine.

I also traveled to Chile, Argentina, Thailand and the Phillipines on Elanco’s dime, promoting ractopamine.

  1. I am not an ag economist, so I am venturing down a path that may be my demise. But I am a physician and have used beta-agonists on many occasions when I was practicing.

JBS USA announced recently that it is going to slaughter and further process only hogs that have not been supplemented with ractopamine, trade name Paylean, an Elanco product, in an effort to get a corner on the China trade. 

History is needed here.

China, Taiwan and the European Union have all seen outbreaks of human illnesses caused by eating beta-agonist-laced meats.

The EU banned all beta-agonists used in food animals, and all imports that had been exposed to beta-agonists, in 1996.

Paylean got FDA approval in 1998.

The prior beta-agonists, one which is named clenbuterol, were very different from ractopamine. Specifically, clenbuterol had a half-life of 30 hours compared to ractopamine’s half-life of four hours.

Studies comparing the two drugs showed significant levels of clenbuterol in animal livers at harvest but negligible levels of ractopamine.

China long ago banned beta-agonist use in domestic herds and in imports because of illnesses linked to the older, longer lasting drugs.

To try and stay competitive, since the ban many Chinese farmers use the illegal, but readily available, clenbuterol and therefore China is still seeing human illnesses related to illegal beta-agonists.

In contrast, in the U.S., ractopamine has been used for 20 years with over 750 million hogs being supplemented with the chemical and not one single human illness reported as a consequence.

My personal opinion is that the EU and China are living in the dark ages and not recognizing the benefits of newer, safer chemicals to increase protein production and help feed an increasingly hungry world.

I mean, what’s worse, starving children or a minimal trace amount of ractopamine in a pig’s liver? 

The international food safety organization sponsored by the World Health Organization, called the Codex Alimenterius Commission, has carefully, over several years, evaluated ractopamine use from a food safety viewpoint and has approved maximum residue limits (MRLs) for ractopamine.

These MRLs are never even closely approached in U.S. pork.

For the moaners and groaners, and there have been many, that claim we are all going to die because the animal ag industry is trying to make more money stuffing their animals with a beta-agonist, I have only to ask them to look at modern medicine’s practices.

Beta-agonists relax smooth muscle.

Without getting too medical here, smooth muscles are those that contract without you telling your brain to do so.

Striated muscle moves when you tell them to, like walking and lifting and speaking.

Smooth muscles are the muscles surrounding airways in our lungs.

These are the muscles in your heart.

A woman’s uterus is one great big smooth muscle that knows on its own to contract every three minutes or so when in labor.

Unfortunately, the uterus is not always smart enough to know when to begin contracting, triggering premature labor and threatening the unborn infant’s life.

So, what do smart doctors do to stop this contracting smooth muscle?

They administer a beta-agonist intravenously that goes directly to that un-born’s body and organs and causes no harm. Maybe a little faster heart rate, but short-lived while the medicos also administer an IV medication to help the little one’s lungs mature in preparation for birth.

When your child or grandchild has a spasm of his or her smooth muscle surrounding their bronchial tubes we call it asthma.

The treatment? An inhaled beta-agonist, again without any worry about adverse side effects as long as directions are followed.

So, we administer a drug very similar to ractopamine to pregnant women, unborn fetuses and small children while listening to the anti-meat consumption crowd rant and rave about giving this chemical to animals, calling it a hormone, etc., which I assure you it is not.

Now, for the economics path that may throw me off a cliff.

Rabobank says China may lose up to 50% of its hog production this year due to African swine fever (ASF).

It is also kicked around that because of ASF, China imports of U.S. pork could hit a record high of 300,000 metric tons, an increase of 50% from two years ago.

Of course, that number could vary dramatically based on how trade talks and trade wars progress, but it appears JBS USA is betting on President Trump winning for our exports.

I am told 26% of this nation’s pork products is exported, not just to China but around the world.  

In fact, of the total pork exported, China and Hong Kong combined account for only 20% of that trade. If my math is correct, then that market in China is consuming only about 5% of the total U.S. pork production.

JBS USA slaughters 93,000 hogs on a good day. Four million hogs per year are theirs and another 20 million belong to private farmers.

What percentage of those hogs end up in China?

I have no clue, but some work I have done with JBS USA revealed a huge domestic market that will now be raised without the benefit of ractopamine.

JBS is surely trying to capture more of that potential Chinese growth market by responding to China’s unscientific ban on a very safe drug that induces growth and leaner meat.

In the meantime, I am assuming their farmers, who are being forced to not use ractopamine, get no extra compensation from JBS to recognize their increased costs per pound of meat.

And I am assuming those increased costs will be passed on to me at my local supermarket.

I hope the Chinese are happy, and I hope the unstable market over there becomes less shaky, but I still think this change, for a small percentage of their sales, reflects poorly on JBS’s overall view of the meat market world and what American consumers want, which are a good value, safe food, environmentally sound practices, humane handling and quality meat.

But then JBS USA is not really an American company is it?

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