A market analyst says he doesn’t expect the volatility in
the lean hog market to ease up anytime soon.
John Heinberg with Stewart-Peterson says any news coming out
of China is causing the market to react and producers need to take steps to
protect their margins. “There are two
things we watch”, he says. “Let’s see if
we get some good runs and some profitability on the cash side. Make sure we’re locking some of those pigs
in. But then – go pick up that out of
the money call or use a bull call spread where we keep some upside potential in
that market overall.”
He tells Brownfield there is still plenty of upside
potential in this market. “There is a
hole in the global protein situation,” he says.
“In that case – even if the pork is moving from Brazil to China or
moving from Mexico to China, that pork is going to need to be filled from
somewhere else. And we’re more than likely
the person to put that there.”
AUDIO: John Heinberg, Stewart Peterson
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