Raising livestock, growing fruits and vegetables, farming, and growing crops represent big businesses that are currently expanding. This expansion is due to the increased demands on the global supply of food due to the growth in world population and increased standards of living in several under-developed countries. Though no farming companies are currently publicly traded, there are other ways to invest in agriculture.
Individuals can invest in food companies, such as Archer Daniels Midland Company, that obtain, process, store, and merchandise the items grown by farmers. They can also make investments in food manufacturing companies that develop packaged foods for public consumption, such as General Mills and Kraft Foods. At the end of this food chain, they can invest in some of the many grocery retail establishments.
Farmers require supplies and equipment in order to grow their crops, so investing in these suppliers represents another way to hold a piece of the agricultural pie. Farm product suppliers provide equipment, pesticides, seeds, and fertilizer to farms. Monsanto is one of the most well-known providers of seeds and John Deere has been an established farming equipment manufacturer since 1837. Potash is a publicly traded integrated fertilizer supplier.
Savvy investors may be interested in trading agriculture commodities in the futures market. They can find futures contracts for rice, wheat, soybeans, oats, and corn traded on different commodity exchanges. Some commercial entities have diversified into fishing and raising livestock and many of them are publicly traded. Investors can also sink their money into meat packing companies like Tyson Foods.
These are a few of the most common ways to invest in agriculture without having one’s own farm. Some of these are more direct investments in the industry than others. The more indirect investments will not benefit as much from the growth in the business of agriculture, but they can still be profitable.
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