I wrote here earlier this week that while hard commodities aren’t all they used to be now that Chinese growth has slowed significantly, agricultural commodities still look interesting.
This prompted an email from Mirabaud Securities alerting me to some of their thematic work. Every year, their analysts run a screen of European stocks for which they have at least 11 years of earnings data. The idea is to see if they can spot any groups of companies with what looks like an emerging structural advantage.
Earlier this year they noted that a group of what you might call ‘smart farming’ stocks were beginning to stand out. As a result they have put together a basket of stocks that “capture the drive towards higher crop yields in the emerging world” as well as to the increasing concerns about food safety worldwide.
I am not actively recommending the stocks in the basket (I haven’t looked at them closely enough) but for those of you that would like to do a little more research of your own, it is made up of the following: BayWa, Carrs-Milling, Cermaq, Eco Animal Health, Eurofins Scientific, Genus, Husqvarna, K+S, KWS Saat, LDC, Novozymes, Nutreco, Olmix, Origin Enterprises, Plant Health Care, Pol-Mot Warfama, Syngenta, Vilmorin and Virbac