In this volatile world, a recent moneymaker can be found "up" on the farm. The USDA came out with a report Friday that’s projecting this year farmers will grow the biggest corn crop in history. Because the corn bonanza is fueled by the ethanol craze, how long will companies linked to agriculture be a winner for investors?
Fertilizer firm Potash Corp (POT) traded up 3% percent Friday in the wake of the crop report. Potash Chief Executive William Doyle joined the guys for this conversation. Here are excerpts from what was said.
Do you see any chinks in the armor?
“The crop report Friday was very supportive of our business,” says Doyle. “But we needed it. When you think about it globally, there’s a very tight situation still.
He adds “(At the same time) the US revised wheat data downward to the lowest level in the history of USDA reports on grain. This is very bullish for fertilizer and well run companies in agriculture.”
Is there anything in the market distress that has any bearing on your world?
“We don’t see it. We see farmers around the world having record income years,” explains Doyle. “There’s just a lot of money being made on the farm and that translates very well for our business.”
Are farmers getting greedy – trying to grow too much corn?
“I don’t see that. One thing that a farmer will never give up is the fertility of the farm,” says Doyle. “Once you lose the fertility you need to move because you can’t grow anything… so farmers don’t scrimp on their land. They protect their land.”
Dylan Ratigan asks the guys what they think of this stock?
Jeff Macke is skeptical.
Pete Najarian, Guy Adami and Tim Seymour all like it.
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Trader disclosure: On Aug 10 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders: Macke Owns (INTC), Najarian Owns (GS), CBOE Volatility Index (.VIX) Options; Seymour Owns (AAPL), (BX), (GLD), (SBUX), (X), (BBD) Seymour Owns Bank VTB OAO