Agriculture Sector

Re: Agriculture Sector

Postby winston » Fri Aug 14, 2015 8:24 pm

The "Boring" Resource Stocks You Should Be Buying Today By Brian Weepie

If you're a resource investor, fertilizer stocks should be on your radar right now.

Making the stuff that helps crops grow might sound like a boring business. But buying these companies could make you a lot of money in the years ahead.

Let me explain…

Fertilizer is essential to grow the food billions of people eat. Most soil doesn't have all of the nutrients that crops need to grow… nutrients like nitrogen.

Nitrogen is the seventh-most-abundant element in the universe. Most of the air we breathe – about 80% – is nitrogen. It's also necessary for healthy crops. They absorb more nitrogen than any other nutrient.

Corn, rice, and wheat – the biggest grain crops – are the most hungry for nitrogen. They demand more than nature can provide.

You see, crops can't use the nitrogen in the air. Airborne nitrogen consists of two nitrogen atoms bonded together. Crops can only use nitrogen atoms that have been attached to hydrogen. The only way that happens naturally is through special bacteria that grow on bean roots… or lightning strikes.

That's where nitrogen fertilizer comes in.

With the help of nitrogen fertilizer, production of the major grains has grown 57% globally over the past two decades, according to the Food and Agriculture Organization of the United Nations (FAO).

That is a huge improvement, but it will have to continue. The world's population continues to increase. It doubled from 3.5 billion in 1968 to more than 7 billion in 2012. And it will add another 3.3 billion in the next 35 years. As the population grows, so will the demand for grains.

The world is also eating more meat…

India and China – which account for 36% of the world's population – are getting richer. The richer they get, the more meat their citizens eat… And it takes a lot of grain to make meat.

Raising a pig requires 3.5 pounds of corn for every pound of pork. It takes between five and 20 pounds of feed for every pound of beef. This is one of the reasons that the annual corn usage in the U.S. has increased nearly every year since 1995.

All of this adds up to more demand for nitrogen fertilizer…

The FAO estimates the world used 113.1 million metric tons of nitrogen last year. That will climb to 115 million metric tons in 2015 and up to 117 million metric tons in 2016.

That's why the world's nitrogen producers are merging to increase production and reach more markets…

For example, just last week, nitrogen producer CF Industries announced it will pay $8 billion to buy competitor OCI's European and North American businesses. CF expects the combined operations will save $500 million per year after-tax. The combined assets will make the world's largest public nitrogen company.

Stansberry Resource Report holding CVR Partners is also expanding its reach. It currently produces its fertilizer from a single plant in Coffeyville, Kansas. But it's in the process of acquiring Rentech Nitrogen Partners and its East Dubuque, Illinois production facility to increase production.

Growing demand and increased production will provide a big tailwind for nitrogen producers like CF Industries and CVR Partners going forward.

But there's another reason I like nitrogen producers right now…

As regular readers know, oil and natural gas prices have plummeted since June 2014. They're now trading at multiyear lows – less than $45 per barrel and $3 per thousand cubic feet (Mcf), respectively.

This has been great news for nitrogen producers' bottom lines…

To make nitrogen fertilizer, nitrogen atoms need to be combined with hydrogen… which comes from fossil fuels like oil and natural gas. And a large portion of the cost of making nitrogen fertilizer is these fossil fuels.

So lower oil and gas prices have dramatically lowered production costs. This is fueling profits for nitrogen producers.

For example, CF Industries reported a 15% increase in its gross margin (revenue less cost of goods sold) from the last year's fourth quarter to the second quarter of this year.

CVR Partner's gross margin is up nearly 5% over the same period.

In short, demand for nitrogen fertilizer is growing… and with low oil and natural gas prices, these companies are pumping out profits.

Many of their share prices are already benefitting. CF Industries and CVR Partners are both up more than 10% since the start of the year. But with increasing demand and low production costs, there's plenty more upside ahead.

I recommend looking at nitrogen producers like CF Industries, CVR Partners, Potash Corp., and Agrium today.


Source: Stansberry Resource Report
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Re: Agriculture Sector

Postby winston » Wed Sep 23, 2015 8:24 pm

The Serious Threat Facing U.S. Food Producers By Matt Badiali

There's a large, scary problem facing the U.S. food industry…

And it could soon affect the share prices of some food producers…

If you've been to the grocery store lately, you may have had trouble finding products made with turkey – like lunch meat.

Tyson Foods brands Sara Lee and Hillshire Farm have had countrywide shortages of their turkey lunch meat.

But it's not just turkey. We're also seeing egg shortages. Many restaurants and food producers are struggling to get eggs to make their food and egg products (like mayonnaise and cake mixes) right now.

The U.S. Department of Agriculture lowered its forecast for table egg production this year by 5.3% from last year.

This isn't just some fluke distribution problem. It's a supply problem. There aren't enough turkeys and laying hens to produce lunch meat and eggs right now.

You see, millions of turkeys and chickens are dying because of a certain strain of avian flu.

Two years ago, migrating waterfowl, like ducks and geese, in the Bering Sea brought a new strain of flu from Asia into Alaska. It spread east and mutated into a deadly disease. Since then, it has wreaked havoc on both wild and domesticated poultry.

It's called a "highly pathogenic avian influenza" (HPAI), which means it spreads like crazy among domestic birds. It is so easy to spread that many live-poultry exhibits at state fairs and farm shows have been canceled this year.

In 1983, a similar flu virus killed 17 million chickens in Pennsylvania alone. It cost the state's chicken farmers more than $65 million. The virus spread to Virginia, New Jersey, and Maryland… affecting turkeys and game birds as well. It led to the destruction of 15 million birds and a big decrease in revenue for many producers there.

Today's virus is worse.

Iowa turkey farmer Brad Moline recently told Congress that he had lost all 56,000 turkeys on his farm in May. In July, more than 8 million turkeys had been killed by this virus, which has cost the poultry industry more than $500 million.

In total, more than 48 million turkeys and laying hens have died from this virus so far this year. Millions more could die as migrating waterfowl head south for the winter and the virus continues to spread.

Companies like chicken-producer Pilgrim's Pride are already starting to feel the strain. Take a look:

Please Enable Images to See this

Shares are down nearly 25% this year.

But things are likely about to get worse for poultry companies. With fewer turkeys and chickens available this holiday season, the earnings of chicken producers like Pilgrim's Pride and turkey producers like Seaboard Corporation (which owns the Butterball turkey brand) will fall… along with share prices.

If you own poultry-producer stocks, consider selling them now. 2015 earnings are likely to be weak when these companies report early next year.

If you're looking for a possible short-sale opportunity, Tyson Foods, Seaboard Corporation, and Pilgrim's Pride look like good candidates going into the holidays.

Source: Stansberry Resource Report
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Re: Agriculture Sector

Postby winston » Tue Oct 06, 2015 7:53 am

Over Half of E.U. Countries Are Opting Out of GMOs

by Alexandra Sifferlin

16 countries want to prohibit genetically modified crops

Source: Time

http://time.com/4060476/eu-gmo-crops-eu ... n-opt-out/
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Re: Agriculture Sector

Postby winston » Wed Nov 11, 2015 9:16 pm

Agricultural commodities struggle… sector fund DBA falls to a new all-time low.
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Re: Agriculture Sector

Postby winston » Thu Dec 03, 2015 10:40 am

3 Ag Stocks to Buy for Decades of Growth

Agriculture firms represent great long-term prospects right now

By Aaron Levitt

Source: Investor Place

http://investorplace.com/2015/12/ag-sto ... l-rEnYrKM8
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Re: Agriculture Sector

Postby winston » Wed Jan 13, 2016 8:36 pm

LONG BUST CONTINUES FOR THIS SECTOR

A classic "boom and bust" sector is stuck in a long downtrend...

Today's chart shows the past three years of trading in the PowerShares DB Agriculture Fund (DBA).

This fund is a "one-click" way to own a diversified basket of agricultural commodities like corn, wheat, soybeans, cattle, hogs, sugar, and coffee.

Prices for these products depend on a variety of "slow" seasonal factors, ranging from the weather to how much seed farmers plant. So once a trend gets going in the "ag" complex, it tends to run for many months, giving it its "boom and bust" nature.

As you can see below, DBA saw an uptick in the beginning of 2014, rising 20%-plus from January to May. But it has been stuck in a downtrend ever since.

Shares are down 15% over the past six months alone. The trend can definitely reverse, but for now the market is telling us to be cautious of this sector.

Source: www.dailywealth.com
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Re: Agriculture Sector

Postby winston » Thu Jan 21, 2016 9:13 pm

Agricultural-commodities fund DBA drops 25%-plus in 18 months.
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Re: Agriculture Sector

Postby winston » Thu Feb 04, 2016 9:08 pm

A New Sector to Put Some of Your Portfolio to Work

By Jeff Clark

The bull market in stocks is over.

But a new bull market might be getting started in another sector.

Let me explain…

Agricultural commodities – or "ags," as traders like to call them – have been beaten up over the past four years. The price of wheat, for example, is down 50% since it peaked in 2012. Corn is down 60%.

But the recent action in these ags has been positive. And the charts are setting up for a new rally phase.

Take a look at this chart of the Teucrium Corn Fund (CORN), an exchange-traded fund ("ETF") designed to track the price of corn…

Please Enable Images to See this

As you can see, CORN broke above its downtrending resistance line last month and is now trading around $21.75. That is higher than its nine-day exponential moving average (EMA) and its 50-day moving average (DMA). And its nine-day EMA is about to complete a bullish cross above the 50-DMA.

This is the first really bullish action we've seen in corn prices since last June – just before they surged 15% higher in two weeks. CORN looks to be set for a run up to at least its 200-DMA at $23.

The chart of wheat prices looks similar…

Please Enable Images to See this

Like CORN, wheat recently broke above its downtrending resistance line. And its nine-day EMA is poised to cross above its 50-DMA. The 200-DMA, at $5, looks like a reasonable target for a short-term move. Wheat is currently trading at $4.76.

At the very least, ags are set up for a decent short-term rally. And as traders pull money out of the falling stock market, they're going to be looking for a new home for that money in a sector that's moving higher, like agricultural commodities are today.

Traders looking to profit on this emerging trend today can look into agriculture-related ETFs, like CORN and the Teucrium Wheat Fund (WEAT), which tracks the price of wheat.

Source: Growth Stock Wire

http://thecrux.com/a-new-sector-to-put- ... ork-today/
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Commodities - General News 03 (Jul 14 - Dec 16)

Postby behappyalways » Thu Feb 18, 2016 6:47 am

Global food production needs 'significant' fertiliser boost
http://www.bbc.com/news/science-environment-35587948
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Re: Agriculture Sector

Postby winston » Sat Apr 02, 2016 6:40 pm

The World May Have Too Much Food

For the first time in history, more people are obese than underweight.

by John Tozzi

Source: Bloomberg

http://www.bloomberg.com/news/articles/ ... _campaign=
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