Friday, September 10, 2010
The price of raw cotton reached 90 cents a pound, up from the 40 or 50 cent average. There is a drought in China and India, while Pakistan is flooded, further exacerbating the cotton shortage and boosting raw cotton prices. We may even see a revival of cotton growing in the Yezreel Valley, Israel. How to ride this situation?
It seems to me that cotton is not the only agricultural product entering a shortage phase. Coffee and wheat are scarce too. Climate is changing faster than agricultural technology and infrastructure, which is always local. Asyncronous development will increase scarcity and hoarding. The Economist has an article about the shallowing of world ag markets. Ag inputs are going to be the next thing. Change your investing plan: Think Israel Chemicals and Machteshim Agan shares.