Agriculture Stocks To Feed Into Your Portfolio

Agriculture Stocks To Feed Into Your Portfolio
Will farmers be driving Ferraris in ten years? That is what Jim Rogers, the immortal billionaire investor who founded the Quantum fund, thinks. We'll have to wait and see if that turns out to be accurate, but his sentiment is based upon a couple of crucial elements that continue to put upward pressure on the rates of agricultural goods.
3 Factors That Could Impact Agriculture Stock Costs
1.) Emerging Industry Demand
Emerging-industry economies like China and India are expanding by leaps and bounds, enriching the citizens of these nations and generating much more demand for higher-finish food merchandise. But due to a combination of rolling demand and huge populations, these countries lack the infrastructure and production capacities to satisfy that 'hunger'. China, for example, is residence to 22% of the world's population but just 7% of its arable land. So in order to fill the gap, these countries will need to have to enlarge their imports, which stand to be a boon for lengthy-term gains in the agriculture stocks sector.
two.) Inflation Hedge
With the Dollar collapsing at a rapidly pace, investors continue to flock to organizations that trade in 'hard assets', and the agricultural stocks complicated certainly qualifies. Though corn, beans and wheat are down sharply from final year, prices have recently begun to rebound and move larger. Difficult assets are currency neutral and will continue to be a outstanding investment destination for everyone alarmed about the ruining of paper currencies.
three.) Global Climate Volatility
Farmers live in a shaky world. One particular season, they spend months praying for rain to nourish their crop then in the next season, the crop gets wiped out because of also considerably rain. Just this summer time, sugar rates soared to a new 28-year high right after a drought killed production in India. Ag producers require just the proper balance of rain, sunshine and nutrients to produce the desired yield, some thing that consistently effects production and, in turn, prices.
Now that we have a important understanding of the underlying essentials affecting prices and consumption in agriculture, let's go ahead and take a appear at some organizations that seem to be well positioned to profit from the trend.
4 Agriculture Stocks
The Anderson's, Inc. (ANDE - Analyst Report) is an agriculture producer and transporter in the U.S. The company's share price tag took a hit final year but has given that bounced back nicely as the economy and its estimates have recovered. With the current-year Zacks Consensus Estimate pegged at $2.22, this Zacks #1 Rank stock offers some value with a P/E of 15X. The Zacks Consensus Estimate for agriculture stocks subsequent year is bullish, projecting 27% earnings growth for this agriculture stock. 
China Green Agriculture, Inc. (CGA - Snapshot Report) operates as a fertilizer producer out of China. Shares posted large gains this year as China's economy has remained hot (recently reporting GDP growth of 8.9%). Subsequent year's agriculture stocks growth projection for the corporation is a bullish 57%.
Zhongpin Inc. (HOGS) has posted enormous agriculture stocks gains in 2009, with its share cost a great deal more than doubling after bottoming out just above $7 in early March. The Chinese-based agriculture producer and Zacks #1 Rank stock delivers big value in a pretty bullish environment, trading at just 10X projected present-year earnings, with a solid 18% subsequent-year growth projection to boot. 
Deere Co. (DE - Analyst Report) builds and manufactures farming machines and equipment. Farmers will be searching for to upgrade their gear if they are raking in huge bucks, and that will give shares of DE with a extremely good increase. As it stands, the company's share price tag is down from its peak in early 2008, but has begun to rebound on a good earnings beat last quarter and rising agriculture stocks estimates.
Agriculture Stocks Conclusion
When you take a composite view of the agricultural stocks landscape, it really is very easy to see that there are a number of macro-level trends that could create lengthy-term growth prospects. It is a superb way to round out your portfolio and give you a likelihood to outperform the averages over the long haul.