Brazil Meat Scandal: Companies Lose Almost $2bn In Value - plus55

Brazil meat scandal: Companies lose almost $2 billion in value

The companies are accused of selling spoiled meat with fraudulent sanitary permits
Brazil Meat Scandal

On Friday, the Federal Police unveiled a comprehensive corruption scheme between meat producers and federal auditors. Giants of the industry are suspected of having bribed auditors in exchange for fraudulent sanitary permits, which allowed them to sell spoiled meat and poultry. Naturally, the Brazil meat scandal impacted the value of these companies.

Over the span of a single day, JBS and BRF – the industry’s biggest players – lost $1.93 billion in value. JBS stock lost 10.59 percent, while BRF’s lost 7.25 percent on Friday. Even Marfrig and Minerva Foods, which are not in the scandal, lost 2.1 and 2.04 percent, respectively.

That impacted the overall performance of São Paulo’s stock market – down by 2.39 percent.

Investors predict a drop in sales by JBS and BRF, Brazil’s biggest meat exporters.

Operation Weak Meat

The term “weak meat” in Portuguese (carne fraca) describes people of weak morals. It is also a reference to the poor quality of meat provided by big corporations.

On Friday, a Federal Court issued arrest warrants against 38 people and blocked more than $350m in assets. After two years of investigations, authorities found that the Ministry of Agriculture used regional bureaus to coordinate the corruption schemes.

This is not the first scandal involving JBS. The company was also under scrutiny for allegedly helping politicians to siphon money away from public pension funds. JBS, just like BRF, denies any wrongdoing.

Vegetarians beware

As the scandal broke, many vegetarians made fun of meat consumers on social media. However, they should be worried about the products they consume, too. A report by El País shows that 70 percent of all “natural” products are filled with pesticides. According to Brazil’s National Institute of Cancer, each Brazilian ingests about 5 liters of these poisonous substances.

Since 2008, Brazil leads the world consumption of pesticides. While their use rose by 93 percent in the world over the past decade, the growth rate in Brazil reached 190 percent.

Between spoiled meat and poisonous vegetables, Brazilians have plenty of reason to worry about their diet.