Rising corn prices leave Pilgrim’s Pride wounded
Corn prices surged to $8 a bushel and soybeans rose above $16 during trading on the Chicago Mercantile Exchange this month, though both ended up settling below those highs.
Pilgrim’s stock rebounded from a 52-week low of $2.91 to reach $8.68 earlier this year. Since then, however, its shares have dropped below $4.60.
Meanwhile, grains futures show no sign of relenting as farmers reduce yields due to drought.
Rising commodity prices have driven investors away from stocks like Greeley-based Pilgrim’s, along with other publicly traded chicken producers nationwide such as Tyson Foods Inc. and Sanderson Farms Inc.
But these stocks also have soared in a year of uncertainty over grains.
In May, Pilgrim’s shares jumped when the U.S. Department of Agriculture forecasted record corn production of 14.79 billion bushels, which would have smashed the previous record of 13.092 billion bushels set in 2009.
Chicken producers face the daunting challenge of a “new corn market,” said Stephen Koontz,
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