A Beginner’s Guide to Investing in Agriculture

Investing in agriculture is always a good idea. Farmland knows no drop in usefulness, and it is especially valuable during financial crises. It is a stable source of profit for investors. Even at its weakest, the agricultural industry is still a big advantage on any portfolio.

World-demand-for-wheat-is-constantly-growing.-Image-via-Shutterstock.com_
Image source: israel21c.org

A profitable and stable area for investors to consider is the grain complex, which includes corn, soybeans, wheat, and oats. These commodities fit into conventional investment wisdom because majority of human beings are regular consumers of grain. Coffee and sugar are also good investments, but unlike grain (and objectively speaking), people can live without coffee and sugar. Even the livestock such as poultry and pork, which humans also consume, need grain.

Speaking of poultry, pork, and cattle, livestock too could fatten portfolios. With the world population booming, the amount of food being consumed is at an all-time high.

There are a few ways to invest in agriculture without the need to own a farm. One of the most beneficial routes investors can take is by taking out a farming-focused real estate investment trust or an REIT, which allows them to buy farms for lease to farmers. REITs are potentially more diverse and generally more liquid than having a farm. REITs can easily be snatched in stock exchanges, and they cost a lot less than purchasing a real farm, easing up the need for investment capital.

636000823130528067-243019236_farn
Image source: theodysseyonline.com

Charles F. Whitman is a Chicago-based investment strategist who helps his clients boost their portfolios. Whitman is also the founder of Whitman Asset Management. Just recently, he was a speaker at the USDA National Agriculture Conference. Learn more about Charles F. Whitman and his work by visiting this LinkedIn account.