Published on 9 June 2022
By Tui Eruera, CEO and Founder of Jaaims
One of the hottest online queries right now is ‘Why are food prices rising?’ It’s an issue investors need to take note of – and one that Jaaims has responded to.
What do cabbages and lettuce have in common? Not much really. Yet these humble greens have been making headlines.
The recent news that several fast food outlets will be using cabbage to supplement lettuce in their products may have raised a few laughs – and more than a few eyebrows. But it is a sign of the serious situation developing in the global food industry.
Global food crisis tops G20 talks
Earlier this year we looked at the emerging food crisis and why this is making ag stocks attractive for investors. In recent months, the challenges facing the food industry have intensified.
It is a topic that until recently, many Australians only read about. However, the damage caused by heavy rain and flooding on the East coast, plus a shortage of labour to bring produce from paddock to plate, is driving food prices higher here in Australia.
The seriousness of the global situation has put strategies to develop resilient food systems high on the agenda at the G20 Bali Summit in November. And it needs to be. A number of countries are shoring up their food supplies by shutting off exports of key products.
China has banned the export of agricultural chemicals to ensure adequate supply for its domestic market. Indonesia has banned the export of palm oil. And India – surprisingly, the world’s second largest wheat producer (after China), has banned the export of wheat amid concerns for its own food security.
These bans will intensify the steep climbs we are already seeing in global food prices.
It makes the appearance of cabbage rather than cos in a chicken burger look like a minor inconvenience.
The ag sector – worth a closer look
For investors, the food crisis has shone a spotlight on the agricultural sector.
Jaaims identified the opportunities of this sector earlier in 2022, and has recently expanded its position with holdings in:
- Syngenta AG – a leading provider of agricultural science and technology
- Deere & Company – the owner of the John Deere brand, best known for manufacturing agricultural machinery
- The Mosaic Company – the largest producer of potash and phosphate fertiliser in the US.
Not surprisingly, Jaaims’ clients have requested portfolios that focus on these opportunities – and we have responded.
Jaaims launches Feed the World portfolio
At the end of June 2022, Jaaims will launch a new Feed the World portfolio.
It will focus on 45 different stocks encompassing food production, fertiliser and commodities such as oil and ethanol.
The Feed the World portfolio is a chance for investors to tap into the food sector in a straightforward and diversified way.
It’s worth noting that food security won’t be resolved immediately by the G20. We are still seeing supply chain issues globally. And even if the conflict in Ukraine (a major producer of wheat and edible oils) ended tomorrow, it will take time, potentially years, for the country to resume its former levels of output.
The upshot is that food insecurity could be with us for some time. For investors, this can make the Feed the World portfolio a medium to long term holding.
To get your serve of the Feed the World portfolio, download the Jaaims app or call the Jaaims team on +612 7908 0292 or email us at support@jaaimsapp.com.
*Any advice provided is general in nature and does not take into account the viewer’s specific needs and circumstances. You should consider your own financial position, objectives and requirements to determine the type of advice and products to best suit your needs. Jaaims Australia is an Authorised Representative of Jaaims Technologies, AFSL 519985.