Understanding commodity price trends

J.P. Gervais, FCC Vice President and Chief Agricultural Economist explains why understanding the commodity market environment has many advantages for setting sound business strategies.

• Commodity price shifts should act as triggers to execute a pre-determined strategy, not develop one
• Marketing strategies should be based on attitudes towards risk and overall cost structure of operation
• Know your cost of production and understand what’s at risk under different pricing scenarios
• Commodity prices also impact profit margins of food processors