We know you hate paying more at the supermarket checkout counter. But we also know one man for whom higher bread and butter prices are his bread and butter. We’re taking about Fast Money farmer, Roger Neshem. In our special look at inflation it only seems appropriate to revisit our friend.
”I thought it would be a very volatile year and if there were any production hiccups we could see the markets explode,” said Neshem when he visited the traders on June 6th.
If you watch the show regularly you might remember that Neshem was very bullish on the ag trade. He did, however, offer a word of caution. “If we were to see the market roll over we’d be in trouble. We couldn’t support the input costs (fertilizer, tractors etc.) with $3 corn.” In other words, he thinks crop prices need to remain high for the ag trade to continue working.
It's not just independent farmers like Roger who are impacted by the ripple effect of ag-flation. It travels up and down the food chain - to fertilizer and seed giants like Potash and Agrium .
When Agrium CEO Mike Wilson visited with us on June 18th we asked if the company would hold onto recent price increases.
”Prices are sustainable as long as the grain fundamentals stay strong,” he said. “If crops stay up then (farmers) can afford to use our products.”
Potash CEO Bill Doyle echoed those sentiments when he visited with us on February 11th. “Supply and demand fundamentals are very much in our favor. People don’t understand, yet, but there’s big demand out there."
Want more? Click below to see our full interview with Roger Neshem, Potash CEO Bill Doyle or Agrium CEO Mike Wilson all taped earlier in the year
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Trader disclosure: On June 30, 2008, the day of taping, following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (C), (GS), (INTC), (BTU), (MSFT), (NUE); Najarian Owns (AAPL), (AMLN), (ANR), (NOK), (NUE), (TSO), (XLF), (YHOO), (HD); Najarian Owns (WFMI) Puts, (MER) Puts, (WFMI) Puts, (HBC) Puts; Najarian Owns (MYGN) Calls, (SLB) Calls, (WM) Calls, (WLT) Calls; Finerman Owns (GS); Finerman's Firm And Finerman Own (TIP), (FLS), (GLNG); Finerman's Firm And Finerman Own (C) And (C) Leaps; Finerman's Firm And Finerman Own (GE) And (GE) Puts; Finerman's Firm Owns (MSFT), (SUN), (TSO), (TWX), (VLO); Finerman's Firm Owns SPX Index Puts; Finerman's Firm Owns (HUN) Calls; Finerman's Firm Is Short (IYR), (IJR), (MDY), (SPY), (IWM); Terranova Owns (BNI), (YHOO), (LUV), (CME), (GOOG), (SU), (INTC), (FXC), (IYT), (XLF), (FCX); Terranova Owns Dollar Index Futures
Terranova is chief alternatives strategist at Phoenix Investment Partners;; Phoenix Investment Partners Ltd. Owns (RWX), (DBC), (DBV), (IGE), (AAI), (ALK), (AMR,) (APA), BP plc, British Airways plc, (CHK), (CVX), (COP), (CAL), (DAL), ENI SPA, (FCX), (XOM), Gazprom, (HA), (HES), (HOC), (HSE), (JBLU), Lukoil, (MRO), (MUR), (OXY), Petrobras Intl Fin, Petro-Canada, (POT), (PBR), Petroleos De Venezuela, (QAN), (RJET), Royal Dutch Shell plc A Shares, (SKYW), (LUV,) (SU), (TSO), Texaco Capital, Total SA, (UAUA), (LCC), (VLO)
Other relevant disclosures
Adami Owned (AGU) On 6/18/08: Najarian Owned (BHI) On 5/28/08Phoenix
Gartman Owns (GLD); (JJG); On 6/30/08 Gartman Owned (GLD) On 6/30/08; CIBC Gartman Index Owns Corn, Gold, Copper, Soybeans; On 6/30/08 CIBC Gartman Index Owned Gold, Corn, Copper, Soybeans
Roger Neshem Owns (MON) (AGU) As Of 7/3/08;Roger Neshem Has A Business Relationship With Monsanto; Roger Neshem Owns (MON); Roger Neshem Owns (AGU) As Of 7/3/08; Roger Neshem Has A Business Relationship With Monsanto; Phoenix Investment Partners Is Long (POT)