Record rains dampen crops in US midwest

Record rains are dampening hopes for the harvest in the US midwest, according to my colleague David Rosen on ICIS news.

(Disclosure: I work for ICIS: About ICIS)

The piece is written for two big issues: fertilizers and food. It misses a third, biofuels. If the crop is bad then the price of corn will rise, if the price of corn rises then the economics of non-integrated ethanol producers is going to look pretty shaky (if it doesn’t already).

If you want to hedge your biofuels position, it might be a good idea to buy into fertiliser firms (OK so I don’t do stock recommendations being (a) unqualified and (b) not a bookmaker) but the capitalisation of fertiliser firms has been growing nicely over the past year, according to David’s piece.


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