Chinese Corn Demand Could Spur Ag ETFsfyi
Chinese Corn Demand Could Spur Ag ETFs
Posted on 07/26/10 at 12:35am by The ETF Professor
China apparently likes corn as the world's fastest growing major economy plans to import as much as 15 million tons of corn by 2015. Imports may total 1.7 million tons this year and 5.8 million tons next year, Bloomberg News reported, citing the U.S. Grains Council.
Increased Chinese demand could be a boon for the newly listed Teucrium Corn Fund ETV (NYSE: CORN), which has been trading for less than two months. Like its controversial peers the U.S. Natural Gas Fund (NYSE: UNG) and the U.S. Oil Fund (NYSE: USO), CORN invests primarily in CBOT traded corn futures.
There is a twist that makes CORN worth a look on increased Chinese demand. CORN doesn't invest exclusively in front-month contracts. Sixty five percent of CORN's assets are invested in second and third to expire contracts.
CORN is one option, but if U.S. farmers are going to plant more corn to meet rising Chinese demand, the Market Vectors Agribusiness ETF (NYSE: MOO) is certainly another option to consider. MOO will give you exposure to names like Deere (NYSE: DE) and Potash (NYSE: POT), two names that should benefit from increased corn demand.
China was a net exporter of corn until 2009.
https://www.benzinga.com/general/10/07/393415/chinese-corn-demand-could-spur-ag-etfs