I’m "very bullish" on the North American agriculture business and stocks, said Charlie Rentschler, agriculture and machinery analyst at Morgan Joseph. He shared his best stock plays.
“Farming is fundamental,” Rentschler told CNBC.
“But I have to caution you that it’s a very unpredictable arena. There are three things that you have to watch: Mother Nature—bugs and weeds and weather—government policies, and commodity prices.”
Rentschler said the new big customer for the American farming industry is the ethanol industry.
“It consumes a third of corn, which in turn means about 10 percent of the arable land in the U.S. is taken up raising corn for ethanol,” he said. “It’s the reason why it’s pushed prices of corn and soybean and provides the purchasing power for farmers to feed the supply side.”
"Buy" rating on Potash
"Buy" rating on Monsanto
"Buy" rating on Titan International
"Hold" rating on Deere
"Hold" rating on Agco
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No immediate information was available for Rentschler or his firm.