Ag stocks show notable gains today with strength in underlying commodities

Thursday, June 5, 2008

Ag stocks show notable gains today with strength in underlying commodities

The ag sector has seen notable strength today, with July corn futures hitting a record high and soybean futures rising sharply (corn closed higher by 28 3/4 cents at $6.43 1/4 per bushel, July soybeans closed higher by 63 cents to $14.52 per bushel)... Today's move higher today in corn comes as heavy rains and flooding continue in key areas in the corn belt, halting farmers from finishing planting and are damaging some newly planted crops... Additionally, the USDA issued its weekly export data, with net sales of corn 11% higher from the prior week and net sales of soybeans 22% higher from the prior week... Generally speaking, higher corn prices help fertilizer cos and farm equipment manufacturers, and hurt the livestock group. Ag stocks that are outperforming today include fertilizer stocks (POT +4.9%, MOS +3.8%, CF +6.2%, AGU +4.4%, TRA +6.% and TNH +1.1%), farm equipment (DE +2.4%, CNH +1.5%). On the negative end is the livestock group (TSN -0.4%, SFD -6.7% (also reported earnings, HRL -0.7%). Also trading higher is seed co MON +4.9%, and chemical names DD +1.8%, DOW +1.4% and BG 0.8%.