Carr’s Milling Industries Plc, a British producer of animal feed, rose to the highest price since at least 1991 after harsh U.S. and U.K. weather boosted demand for its manufactured feed blocks in place of harvested crops.
The shares gained 3.6 percent to 1,476 pence in London. Trading volume was more than five times the three-month daily average.
Carr’s has advanced about 19 percent since July 15, when it said that the U.K.’s cold winter, and a harsh winter and droughts in the U.S., improved sales of its feed and health products for animals. The stock has had the second-biggest advance in the last 12 months among the 11 companies in the FTSE All-Share Food Producers Index, with a gain of 70 percent.
Carr’s, founded in 1831, also produces flour in an industry it says is “plagued by over-capacity and volatile input prices.” The shares may rise further as the Carlisle, England-based company opens a new mill in the port town of Kirkcaldy that will provide easy access to overseas wheat, Phil Carroll, an analyst at Shore Capital, said in an interview.
“The market’s been under pressure but Carr’s have just invested in a brand new state-of-the-art mill, which will give them a competitive advantage over market peers,” said Carroll, who recommends buying the stock. “From a positioning point of view they are in a healthy place going forward.”
The U.K. is on pace to import the most wheat since 1978 as buyers increase stockpiles after a weak harvest, according to the Agriculture & Horticulture Development Board.
The milling business is improving, while Carr’s is generating more revenue from AminoMax, a protein nutrition product for dairy cattle, the company said last month.
Carr’s is increasing investment at a New York factory to boost production of AminoMax. The product has had an “encouraging” reception from U.K. dairy farmers after the company opened a plant in England in June.
Carr’s also bought Silver Springs, Nevada-based Western Feed Supplements in June, giving the company access to dairy and beef markets in the western U.S.