Agriculture Stocks Rally Amid Grain Price Surge in Chicago

  • Deere, Monsanto and Mosaic among gainers in New York
  • Soybeans, corn prices spur speculation on farmer spending

Deere & Co. and Monsanto Co. were among North American agricultural stocks that climbed Tuesday as a jump in commodity prices prompted speculation that farmers will increase spending on fertilizer, seeds and machinery.

Deere, the world’s largest farm-equipment maker, gained 5.2 percent to $8.36 at the close in New York, the biggest increase in six months. Monsanto, the largest seed company, climbed 4.8 percent while fertilizer producers Mosaic Co.Potash Corp. and CF Industries Holdings Inc. also advanced.

Soybean futures closed up 3.3 percent on the Chicago Board of Trade after earlier touching an eight-month high, while corn reached its highest since early October. The gains come amid a decline in the dollar and worries that flooding in Argentina and dryness in parts of Brazil have cut crop production. The planting season in the U.S. has just begun, with 13 percent of the domestic corn crop planted as of the start of this week, according to the government.

"The fertilizer prices and the stocks are exceptionally sensitive to the grain prices," Jason Miner, a senior analyst with Bloomberg Intelligence in Skillman, New Jersey, said in an interview. "The key question on fertilizers is whether prices have bottomed. A positive move in corn and soybeans lends credibility to those analysts that have been calling a bottom."

  • Among other fertilizer stocks moving higher: Agrium Inc., Intrepid Potash Inc., CVR Partners LP.
  • Seed makers Syngenta AG, whose American depositary receipts trade in New York, and DuPont were also up.
  • Other stocks to advance included machinery maker AGCO Corp. and grain traders Archer-Daniels-Midland Co. and Bunge Ltd.
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