By Alena Standley, Montana Farm Bureau regional manager
Tips from Dr. Nevil Speer, U.S. Operations Agriclear, as presented in his workshop at the 2017 American Farm Bureau Federation Annual Convention and Trade Show.
Dr. Speer takes the business of raising beef back to some of the basic principles that we could all be reminded of by emphasizing Business Risk Management is as important as Market Risk Management. Cattle producers sometimes forget that there are simple tools that can be implemented on the ground level rather than focusing primarily on marketing tools like the stock market and forward contracts.
The current beef market is pushing beef producers to seek management solutions that will help with the close margins they face. “You can’t be unwilling to change your practices when the circumstances around you are changing.” — Dr. Nevil Speer
Key Takeaways: Manage External Risk
- Lock in margins
- Refinance long term debt
- Pay down debt
- Increase working capitol reserve
- Manage costs
These tips seems like common sense, but who couldn’t use the reminder!
“Managing risk includes a willingness to give up some upside potential to protect against downside risk”– Dr. Speer
Keep in mind that risk management can bring criticism from your peers. You are doing something no one else is doing! Therefore, beef risk management takes resilience.
This blog post was based on a workshop held at the 2017 American Farm Bureau Federation Annual Convention and Trade Show in January 2017. Become a Montana Farm Bureau member today to join in on these excellent educational opportunities: www.mfbf.org/.