SAN FRANCISCO — Pilgrim’s Pride shares surged Friday after the chicken producer posted a third-quarter profit that topped analysts expectations, aided by stable gross margins and cost controls.
Pilgrim’s, which exited bankruptcy court in December 2009, said it’s hedged 40% of its anticipated corn and soybean needs in the futures market through September of 2011. Some of those prices are locked in below the current December futures corn contract price.
The company uses four million bushels of corn a week, and under its bank-lender agreements, it can hedge up to two-thirds of its grain consumption. Shares of U.S. chicken producers have dropped in recent months over concerns about the impact of surging feed-grain prices.
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