Agriculture stocks jumped to new 52 week highs today as the cost of food continues to rise. This rising price of food has been one of the main drivers behind the protests and riots all over the world. Many poor nations with high unemployment spend a majority of their money on food. As inflation jumps, food prices rise as well. This is making more and more of the worlds poor unable to feed themselves. The unrest stems largely from that.
Agriculture stocks continue to rise. The Mosaic Company (NYSE:MOS) jumped to a new 52 week high today, trading at $87.78, +1.86 (+2.16%). In addition, Potash Corp./Saskatchewan (NYSE:POT) did the same. Other agriculture plays are also surging and nearing their 52 week highs. Monsanto Company (NYSE:MON) and Intrepid Potash, Inc. (NYSE:IPI) are both having solid days higher.
The key to the future will be inflation. There is little chance food will see significant declines because of the massive printing of money and the growing global population. This leaves the door open to more protests like those that engulfed Egypt. This has to be a concern to many governments all over the world. Should protests begin in countries like Saudi Arabia, the markets would take a harder hit because they are a larger oil producer.
It is hard to go long the fertilizer, agriculture stocks at these levels. However, strong pull backs should be great buying opportunities.