4-21 IAN Risk Management

 Profit in agriculture is based on what a producer pays vs. what a producer sells for. That’s risk…I’m DS and we’ll talk risk management in a minute. I was reading a news article that headlined; Feed Prices: Major Factor for Livestock Profitability. The article went on to say  “Feed grain prices will be a major factor for profitability for livestock producers this year. With many analysts expecting corn prices to reach $6 per bushel, profit margins will be reduced and risk management will be critical.” I called Kevin Hughes, Risk Manager at AgriBeef Corporation to ask about risk management: “What you pay for it and what you sell it for, as long as you’ve got that selling price keeping pace with your input costs, your margins stay static but if consumers start balking at higher prices and input costs don’t stop going up, then it impacts directly on your margins.”