Comment Text:
Mr. Kirkpatrick and others to whom it may concern,
The proposed change to the definition of bona fide hedging is severely limiting to the way many in the industry control price risk. For Beef Northwest specifically, it would unnecessarily and severely limit our ability to utilize futures contracts to pre-hedge grain and lock in basis levels, among other perfectly legitimate risk management functions that have been utilized by industry participants for years. The impact of this new definition will likely be an increase in the cost of raising cattle, implying an increased cost in the price of doing business. Food production is a low-margin business - either this increased cost will be passed along to the consumer in the form of higher beef prices, or hedgers will exit the industry, which will ultimately result in increased prices to consumers anyway. We strongly urge you not to adopt this new definition.
Chris Miller
Director of Risk Management
Beef Northwest Feeders, LLC
