January 13, 2015 – Between factors (such as the weather) complicating production yields, trends impacting popularity and the constant shifts of global economies, the protein market is in constant flux and is nearly impossible to navigate. Robert Joyce, then a commercial commodity consultant at Stewart-Peterson, provided a myriad of examples from the past year to illustrate the volatility of the market as he explain market scenario planning by the numbers. With market unpredictability a constant, companies benefit when using strategies to minimize financial risk. One such strategy is commodity price management, which involves combining physical purchases with hedging activity to reduce the volatility.
“It is not useful to say, ‘I think milk is going to go up, so we should get pricing in place,’” Joyce advised. “Very few people ever out-guess the market.” Instead, he recommended Market Scenario Planning. “This does not predict which way the market will go for soybeans, for example; rather, it will tell you that if you put a strategy in place, you will know what you will pay for soybeans.”
“Market Scenario Planning: By the Numbers,” Marshall Harting, Director of Business Development, Stewart-Peterson Inc.
The summary above is from the “2014 Protein Trends & Technologies Seminar: Business Strategies” Magazine
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