How do I invest in agricultural commodities?

[chatty]

I have been listing to Jim Rogers who views that it's time to short stocks but long agricultural commodities such as sugar, cotton, wheat etc.

How do we invest in these commodities?

 

[Conza88]

I have been listing to Jim Rogers who views that it's time to short stocks but long agricultural commodities such as sugar, cotton, wheat etc.

How do we invest in these commodities?

Him, Schiff, and Ron Paul... the only people worth listening too really.

This is a great question and I'd also love an answer.

 

[GumbyLearner]

Not that Mr.Rogers needs any introductions. But here are some links.

I know he has an interest in a newly China-focused ag index that's linked with Macquarie. (I don't hold)

http://www.macquariefunds.com.hk/hk/en/mfg/asset_classes/indices/marcai/performance-chart.htm

http://www.upsecurities.com/intermediaries/documents/RICI Ag Brochure.pdf

 

[ROE]

I have been listing to Jim Rogers who views that it's time to short stocks but long agricultural commodities such as sugar, cotton, wheat etc.

How do we invest in these commodities?

Buy future contracts or soft commodity related company.
PrimeAg Australia to name one of them .. I don't have shares in them I just know them.

I don't chase the next big thing ...I chase the thing that are here and now and try to buy it cheap.

 

[drillinto]

You may wish to consider the Australian Agricultural Company(Code: AAC)

http://www.aaco.com.au/default.aspx

 

[alphaman]

Past performances of Aussie agricultural companies aren't great. To minimise risk of incompetent management, commodity EFTs might be the way to go.

http://seekingalpha.com/article/30369-commodity-etfs-and-etns

 

[So_Cynical]

I have been listing to Jim Rogers who views that it's time to short stocks but long agricultural commodities such as sugar, cotton, wheat etc.

How do we invest in these commodities?

U can get exposure to some of these commodity's via the listed company's involved in
there harvesting, marketing and or production...here's a few off the top of my head.

• Sugar - MSF Maryborough sugar Factory
• Milk & cheese - WCB Warrnambool Cheese and Butter
• Beef - AAC Aust agricultural company
• Wheat - AWB Awb Limited
• Cotton - NAM Namoi Cotton
• Vegetables - WBA Webster

 

[MRC & Co]

Past performances of Aussie agricultural companies aren't great. To minimise risk of incompetent management, commodity EFTs might be the way to go.

http://seekingalpha.com/article/30369-commodity-etfs-and-etns

Yep, that's the golden link.

But remember, if you are going to invest in most of these, you will be wanting to hedge your USD exposure (probably paramount, with the AUD marching higher and higher).

 

[Dowdy]

I have been listing to Jim Rogers who views that it's time to short stocks but long agricultural commodities such as sugar, cotton, wheat etc.

How do we invest in these commodities?

Well you could buy a big shed and store your commodities in there. :

There are several platforms that let you trade commodities. i use Cityindex.com.au

There are several commodity indexes that are on the USA stock market:
Dow Jones-AIG Commodity Index
DWS Global Commodities Stock Fund
iShares S&P GSCI Commodity-Indexed

 

[awg]

check here

http://www.commbank.com.au/about-us/news/media-releases/2009/260509-news-Agribusiness-secor.aspx

excerpts:

The Commonwealth Bank Agribusiness index measures the performance of the Commonwealth Bank defined ‘Agribusiness’ sector over time. The Commonwealth Bank Agribusiness sector currently consists of 14 rural-dependent companies: Australian Agricultural Company Limited (AAC), ABB Grain Limited (ABB), AWB Limited (AWB), Elders Limited (ELD), Forest Enterprises Australia Limited (FEA), GrainCorp Limited (GNC), Gunns Limited (GNS), Incitec Pivot Limited (IPL), Nufarm Limited (NUF), Primeag Australia Limited (PAG), Ruralco Holdings Limited (RHL), Ridley Corporation Limited (RIC), Select Harvests Limited (SHV), Tassal Group Limited (TGR). Companies previously included in the

sector but since removed due to delisting or exiting the All Ordinaries index include Queensland Cotton Holdings Limited (QCH), Auspine Limited (ANE), Great Southern Limited (GTP) and Timbercorp Limited (TIM).



Tuesday 26 May, 2009: The listed agribusiness sector remains in positive territory and has continued its strong performance relative to the broader market, according to recently-released data by the Commonwealth Bank.

The May Commonwealth Bank Agri Indicators Report revealed the listed agribusiness sector delivered a return of 3.7 per cent in the month to 15 May 2009, compared to an almost flat result of 0.8 per cent for the broader S&P/ASX 200 accumulation index. etc etc

(ABB has been good for me over the last couple of months due to takeover offer)

 

[So_Cynical]

The Commonwealth Bank Agribusiness index measures the performance of the Commonwealth Bank defined ‘Agribusiness’ sector over time. The Commonwealth Bank Agribusiness sector currently consists of 14 rural-dependent companies: Australian Agricultural Company Limited (AAC), ABB Grain Limited (ABB), AWB Limited (AWB), Elders Limited (ELD), Forest Enterprises Australia Limited (FEA), GrainCorp Limited (GNC), Gunns Limited (GNS), Incitec Pivot Limited (IPL), Nufarm Limited (NUF), Primeag Australia Limited (PAG), Ruralco Holdings Limited (RHL), Ridley Corporation Limited (RIC), Select Harvests Limited (SHV), Tassal Group Limited (TGR). Companies previously included in the

sector but since removed due to delisting or exiting the All Ordinaries index include Queensland Cotton Holdings Limited (QCH), Auspine Limited (ANE), Great Southern Limited (GTP) and Timbercorp Limited (TIM).

That list is a little misleading...FEA and SHV sell forestry and tree crop
investment products...i don't consider that to be agribusiness.

 

[rowie]

Not that Mr.Rogers needs any introductions. But here are some links.

I know he has an interest in a newly China-focused ag index that's linked with Macquarie. (I don't hold)

http://www.macquariefunds.com.hk/hk/en/mfg/asset_classes/indices/marcai/performance-chart.htm

http://www.upsecurities.com/intermediaries/documents/RICI Ag Brochure.pdf

Thanks for the info on these index's Gumby - I just found out that the macquarie fund is at the moment purely an index and cant be invested, but that they are gonna link it to a fund which will be launched in the future. Do you know why they would create such an index without any mechanism of investing into it? Or do they create this index first and then a fund later to link it? Just seems like an unnecesary exercise to create an index that no one can invest in - unless it has to be created prior to a fund linking to it. Anyones thoughts would be appreciated.

Cheers

Rowie

 

[andrewke]

Thanks for the info on these index's Gumby - I just found out that the macquarie fund is at the moment purely an index and cant be invested, but that they are gonna link it to a fund which will be launched in the future. Do you know why they would create such an index without any mechanism of investing into it? Or do they create this index first and then a fund later to link it? Just seems like an unnecesary exercise to create an index that no one can invest in - unless it has to be created prior to a fund linking to it. Anyones thoughts would be appreciated.

Cheers

Rowie

I sent them an email to back in June & received this reply....
"The Macquarie and Rogers China Agriculture Index is not investable. However, we are going to launch a fund that tracks the Index performance and will have our sales team to keep you posted on the fund launching information. "

Have not heard anything yet.

 

[WilliamKong]

I have been listing to Jim Rogers who views that it's time to short stocks but long agricultural commodities such as sugar, cotton, wheat etc.

How do we invest in these commodities?

You can buy futures or warrant on agricultural commodities if you want to invest on sugar, cotton, wheat, cocoa or even coffee. Cheers.

 

[wayneL]

You can buy futures or warrant on agricultural commodities if you want to invest on sugar, cotton, wheat, cocoa or even coffee. Cheers.

This is true.

But many futures based ETF/Ns have the problem of negative roll yield when the futures strip is in contango. In other words, the fun/note gradually loses value relative to the actual commodity.

The big cost of "investing" in commodities is cost of carry. "Trading" is an entirely different matter.

Compare Spot Oil to USO as an example.