JBS (JBS) Q2 FY26 earnings call: guidance and Q&A

Despite peers cutting guidance and beef cutout reaching a ceiling, what gives comfort that U.S. protein demand remains healthy, and why won't spreads erode further?

Wesley stated that demand remains very strong, especially for beef and chicken, noting the inelasticity of protein demand. He observed a shift from away-from-home to at-home consumption but believes overall protein demand will continue to be strong.

“We have found out actually that -- and we didn't think it -- we use it to think that proteins had more of a substitution effect depending on prices. And there was a big surprise of the inelasticity of protein demand when it comes to demand for beef, demand for pork and meat for chicken not being so substituted to each other.”

asked by Thiago Bortoluci · answered by Wesley Batista Filho

How did U.S. Beef achieve significant margin improvement in Q2 despite tough market conditions, and what specific initiatives contributed to this?

Wesley attributed the improvement to internal initiatives, including integrating two previously separate business units (Swift and Packerland) to capture synergies, especially on the sales side, and focusing on value-added items. He noted that a 3% improvement plan is just beginning to be realized.

“So we went ahead and put those 2 business units together and run nowadays, the business unit is one. And look, there is -- on both sides of the business, there is strength that 1 had and the other 1 didn't have. And we think that there is going to be a lot of synergies there, and a lot of them are on the sales side.”

asked by Ricardo Alves · answered by Wesley Batista Filho

What is the expected pace and impact of the Mexican border reopening on cattle imports, capacity utilization, and cattle prices, especially regarding the 1.52 million heads historical level?

Wesley detailed the phased reopening of ports, starting with Douglas Arizona (300,000-400,000 head capacity), followed by Santa Teresa and Columbus. He expects significant flow (potentially exceeding 1.2 million heads) by Q2 2027, with heavier cattle initially, which should help margins and move towards a more normalized supply.

“So those 3 ports should be able to handle a big part, if not 100% of the normalization of the border. Again, these are all estimates that we have, right? We're looking at historical numbers and looking at numbers provided in the public for the public.”

asked by Leonardo Alencar · answered by Wesley Batista Filho

What are the updated thoughts on heifer retention and the timeline for fed cattle supply rebuild, especially given drought concerns and the impact of Mexican cattle flow?

Wesley acknowledged timid U.S. herd rebuild but emphasized that the Mexican cattle flow (potentially 1.1 million+ heads) significantly balances the situation, making the current environment more manageable. He also highlighted declining beef cow processing and promising Canadian herd rebuild as factors.

“But at the end of the day, what really matters is, number one, it seems like it has -- or now it has top dropping, and that's a big deal. And I think we're going to start seeing we see signals that we might going to start going up.”

asked by Pooran Sharma · answered by Wesley Batista Filho

Can you elaborate on the weaker demand for U.S. pork, the differences across cutouts, and the headwinds impacting profitability?

Wesley explained that stable industry volume with lower cutout prices indicates weaker demand, particularly from processors and in prepared foods. He suggested consumers might be cutting back on those options, but noted it's a quarterly observation, not necessarily a long-term trend.

“So Pork has has had a weaker demand than chicken and be for sure. And look, I think the biggest thing is -- first of all, if you look at just the volume process by the industry is kind of stable and the cutout is lower. So that just tells you that demand seems weaker because it's the same amount of supply and lower price.”

asked by Benjamin Theurer · answered by Wesley Batista Filho

With the China quota suspension, how are export volumes and pricing for Brazil beef aligning with expectations, and what is the outlook for China demand and redirecting volumes?

Gilberto stated that Brazil will resume production for China in October, with shipments restarting in November, impacting 2027 results. He anticipates a reduction in harvest and falling cattle prices in Brazil until October due to the lack of China quota, but expects the market to return to a healthy situation in coming months.

“Brazil should presume production for China in October with shipment restarting in November. And given the normal transit times that commercial impact of those shipments will be reflected primarily in 2027.”

asked by Renata Cabral · answered by Unknown Executive

Given Wesley's experience across all divisions, what is his agenda for JBS, and what will be the focus of JBS under his leadership?

Wesley emphasized continuity with the existing strategy, leveraging new growth avenues like Southeast Asia (750 million population market with the GIC deal), Oman, and continued brand evolution in traditional geographies. He highlighted the strong leadership team and the focus on maturing existing growth initiatives.

“The good thing about a transition that's internal like what we're doing is that there is a lot of continuity, right? So when you get a new CEO that comes from a market, from the market or that's not on the day-to-day of the operations and the guys knew and they have to come up with something completely new and something completely different sometimes, right, just to maybe mark kind of what direction that they think is relevant. And that's exactly not the case, right?”

asked by Guilherme Palhares · answered by Unknown Executive