April 2023 - Strategy FINAL - Flipbook - Page 17
Marketing
head and another 10% when it
hits $15/head. The point here is
to get started, and if the markets
keep allowing a higher crush
follow it up and keep doing some
until you have half or two-thirds
covered. Then it is up to you
if you want to do more or let
the market run. If it does, don’t
be afraid to lock those margins
when you can. If you set your
targets in advance and have a
plan, you’ll be more successful.
It should be understood that you
really need good records and
financials so that you know your
breakevens. That will allow you
to know exactly what the markets
are offering you on that crush
margin per head. Almost every
year the futures markets have
allowed pork producers to lock in
very good margins. If you utilize
this type of strategy your margins
should be more consistent year
after year.
Lastly, know when you need
help. If you don’t understand
the markets or how to do risk
management, I encourage you
to find an advisor or consultant
that does. It will take some
determination on your part and a
willingness to learn new skills, but
understanding these things will
pay off in the end. In addition,
if the next generation is coming
into the operation include them
in this learning process as it will
benefit both of you and your
business over the long term.
Reach out to Big Stone
Marketing at (507) 825-4211 if
you’d like to discuss further.
www.pipestone.com
17