Investing in agriculture might not be the first thing that comes to mind, but it plays a vital role in our everyday lives.
It’s the industry responsible for the food on our tables, whether crops or livestock. Investing in agriculture doesn’t necessarily mean investing in actual farms. There are various aspects of the farming industry to consider, such as manufacturing companies that produce the necessary materials, equipment providers, and even the farming companies themselves.
However, it’s important to understand the risks involved, including the unpredictable British weather, which can significantly impact profits. If you’re interested in owning a piece of American farmland, you’re in good company! Bill Gates, the billionaire founder of Microsoft, has invested heavily in farmland. Fortunately, you don’t have to navigate the complexities of direct ownership.
Below, we’ll give you 3 stocks you can buy to get a slice of the action. So, put on your Wellington boots and join us as we plough through the risks and rewards of investing in agricultural stocks!
If you want to invest in agriculture stocks a little closer to home, there are some UK agriculture stocks that you can invest in, such as:
We’ve listed some examples of agriculture stocks with more information about them, and you can see an A-Z list below if you’ve got any in mind.
Scotts Miracle-Gro manufactures and sells lawn, garden and pest control products. Scotts Miracle-Gro owns 27 brands worldwide.
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Dole is a world-leading fresh produce provider. It operates in 30 countries worldwide and grows, sources and packs 300 lines of fresh produce. In July 2021, Dole joined forces with Total Produce to create Dole plc.
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Agriculture stocks can be rewarding — you’re helping companies put food on the table, which means you can feel responsible for bringing home the bacon. There are also loads of different angles that you can invest in.
Agriculture stocks can have dry spells, so you can’t expect your investments to grow consistently all of the time. Check out some of the risks involved when you invest in agriculture stocks before you count your chickens.
Investing in agriculture isn’t all cash crops. There are risks involved.
For example, crops could become damaged if exposed to disease, fire or pests. The weather could reduce the yields, which can be unpredictable here in the UK.
You can protect yourself from these risks in some ways, such as by diversifying your portfolio geographically and by commodity.
All investing should be regarded as longer term. The value of your investments can go up and down, and you may get back less than you invest. Past performance is no guarantee of future results. If you’re not sure which investments are right for you, please seek out a financial adviser. Capital at risk.
Interested in owning American farmland? You can join the likes of Bill Gates, who has invested heavily in the asset class. 3 options to consider are the following stocks: Farmland Partners, Gladstone Land and Limoneira.
Farmland Partners. This internally managed real estate investment trust (REIT) owns and manages high-quality farmland across North America. With approximately 163,700 acres of owned farmland and 31,000 acres of managed farmland, it offers diverse crops and has over 100 tenants.
Gladstone Land. This competing REIT owns 169 farms totalling approximately 116,000 acres in 15 states. Unlike Farmland Partners, it focuses on ‘permanent crops’ – those planted once and lasting up to 25 years. Examples include almonds and avocados.
Limoneira. While not a REIT, Limoneira is an agribusiness and real estate development company with roughly 11,100 acres of land. It is one of California’s oldest citrus growers and has crops not only in the US state but also in Chile and Argentina.
By investing in these options, you can own a piece of American farmland without the complexities of direct ownership. Whether you prefer primary crops, specialty crops, or citrus fruits, these opportunities provide access to diverse farmland portfolios.
Agriculture stocks offer a unique opportunity to diversify your portfolio and contribute to the vital industry that puts food on our tables. With various angles to invest in, it allows you to support companies responsible for feeding the world.
However, it’s important to be aware of the risks involved when investing in agriculture stocks. Crop damage from disease, fire or pests can affect yields, and unpredictable weather, particularly in the UK, can impact agricultural productivity. To mitigate these risks, consider diversifying your portfolio geographically and by commodity. Investing in agriculture stocks across different regions and crops can help balance the potential negative impacts of localised issues.
Additionally, it’s worth noting that the global landscape of agriculture is influenced by factors such as the decreasing availability of farmland, changes in agricultural productivity and geopolitical events like the Russian war in Ukraine.
| Response | |
|---|---|
| A Russian company | 3.74% |
| A company still operating in Russia | 3.23% |
| Weapons manufacturing | 2.94% |
| Tobacco | 2.33% |
| I wouldn't feel guilty | 2.04% |
| Cannabis | 1.97% |
| Meat farming | 1.24% |
| Oil | 1.12% |
| None of the above | 0.87% |
| Banks | 0.67% |
| Vaccine production | 0.63% |
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