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Ways to Play the Agriculture Sector


Plus, Monsanto leads the fight against Prop. 37 in California, and more!

This column highlights the past week's most interesting and useful business and financial news related to agriculture from around the Web.

"The Surging Demographic Trends Behind Grain Investing"
In light of increasing global population and rising demand for corn, soybeans, and wheat, Jared Cummins takes a look at ways to play the already high demand for these commodities, including DJ-UBS Grains Total Return Sub-Index (NYSEARCA:JJG), Teucrium Corn Fund (NYSEARCA:CORN), and MLCX Grains Index TR ETN (NYSEARCA:GRU). Read more at Commodity HQ.

"Agriculture ETFs: Farmland Prices Spike"
The Federal Reserve Bank of Chicago has noted that farmland prices have risen 15% year-over-year throughout Iowa, Illinois, Indiana, Wisconsin, and Michigan. The Federal Reserve Bank of Kansas City announced that farmland has risen 26% in the Great Plains region, year-over-year. Net farm income is on the rise, from $117 billion in 2011 to $122 billion projected for 2012. Read more at ETF Trends.

"The Best Route to Play Commodities"
The Wall Street Journal takes a look at how individual investors can trade various commodities markets including metals, energy, and agriculture. While these might not always seem accessible, through a wide range of available options, including mutual funds and ETFs, individuals have a wealth of investment opportunities. Those looking to take a position in the agriculture sector should note few publicly traded companies are directly engaged in growing corn and wheat. Ways to play the sector could include Market Vectors Agribusiness ETF (NYSEARCA:MOO), Deere (NYSE:DE), Monsanto (NYSE:MON), and PowerShares DB Agriculture Fund (NYSEARCA:DBA). Read more here.

"Dennis Dishes the Dirt on Fertilizer Stocks"
Carolyn Dennis, vice president and senior equities analyst at Dundee Capital Markets, shares her opinion on the big names in the fertilizer business in this exclusive interview with Seeking Alpha. According to Dennis, the Q4 2012 potash market will lag due to delayed contracts in India and China into 2013, which have led Potash Corp. (NYSE:POT) and Uralkaliy (MCX:URKA) to announce inventory shutdowns. Dennis highlights that demand in North America remains normal, despite worries that farmers would use less potash due to early harvest and drought. Dennis believes demand growth for potash will be over 3% in the coming years, versus projected 4%-5% growth a few years back.

Dennis does not believe that high prices set by Canpotex, the Canadian joint venture between PotashCorp, Agrium (NYSE:AGU), and Mosaic (NYSE:MOS), have positioned the company outside of the Chinese market.

"A Deeper Look at China's Commodity Industry"
Insider Monkey opens the lid on China's energy, mining, and agriculture industries, and ways for investors to play these markets. At over 10% of GDP, China's agricultural sector is grounded on being not only the world's largest producer of rice -- 38% more than India -- but also the world's largest producer of wheat and fresh vegetables. China is the world's largest agricultural exporter. Investors seeking exposure to the Chinese agriculture markets can look at Zhongpin Inc. (NASDAQ:HOGS) and China Mengniu (PINK:CIADY).

"Monsanto Spends More Than $8 Million to Fight Calif. Labeling Initiative"
In California, Proposition 37 would require all genetically modified foods to be labeled as such. The world's largest agricultural biotechnology company, Monsanto, leads a long list of agri-chemical companies who have spent a total of $45 million fighting the initiative. This is compared to the $7 million raised in support of the initiative. Read more from St. Louis Business Journal.

Twitter: @brokawbrokaw
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