PROCESSING giant Swift Australia should be forced to divest assets to reduce its market power.
That's the opinion of southern NSW beef farmer and maverick Liberal senator, Bill Heffernan, who has warned a partnership between the Brazilian-owned Swift and a major retailer could lead to lower prices for farmers.
The Australian Competition and Consumer Commission is currently assessing whether or not Swift should be allowed to acquire feedlot processing facility Rockdale Beef, at Yanco in southern NSW.
Swift controls 22 per cent of the Australian processing sector with US-owned Cargill Australia the next biggest player with 12 per cent.
JBS Swift began its assault on Australia in 2002 when it bought Australian Meat Holdings.
Since then it has bought the Tasman Group for $150 million and Australia's largest meat processor Tatiara Meat for $30 million.
It has also entered the trucking business in southern Queensland.
Senator Heffernan said the company should be forced to sell off a feedlot to add more competition to the market.
"JBS Swift will have annually more than 350,000 cattle," he said.
The Rockdale acquisition would take another buyer out of the market, he added.
Senator Heffernan said Swift's policy of buying cattle "in the paddock" - without the cattle going to sales - meant there was no market to judge the value of those cattle.
He also warned an alliance between a meat company with concentrated market power and a supermarket with concentrated market power would be bad for farmers and consumers.
"JBS Swift is one of three (major processors) in the US, but the top five supermarkets there have 40 per cent (of the packaged grocery market) - here the top two have 80 per cent," Senator Heffernan said.
Victorian Farmers Federation Livestock Group president Chris Nixon said Swift had about 40 per cent of the market share in southern Australia and farmers would have to rely on the ACCC to ensure they weren't "disadvantaged over the longer term".
