Long term investment in grains/wheat

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over45
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Long term investment in grains/wheat

Post by over45 » Thu May 17, 2018 3:01 pm

If you thought grains/wheat was a good long term investment (over a period of 10-15 years), what would the best way to make an investment in it? Tks.

Silk McCue
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Re: Long term investment in grains/wheat

Post by Silk McCue » Thu May 17, 2018 3:09 pm

This may help.

https://finance.zacks.com/invest-wheat- ... -1816.html

On a lighter note:

I would do wheat conversions to bread and eat the gains. Conversion of raw milk to butter would sweeten the returns.

Cheers

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Pajamas
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Re: Long term investment in grains/wheat

Post by Pajamas » Thu May 17, 2018 3:11 pm

over45 wrote:
Thu May 17, 2018 3:01 pm
If you thought grains/wheat was a good long term investment (over a period of 10-15 years), what would the best way to make an investment in it? Tks.
I wouldn't because I think there are almost certainly much better investments.

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Tyler Aspect
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Re: Long term investment in grains/wheat

Post by Tyler Aspect » Thu May 17, 2018 3:27 pm

Stay with broadly diversified index funds. These zany neat ideas will mess up your investments if you do not rein them in.
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aristotelian
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Re: Long term investment in grains/wheat

Post by aristotelian » Thu May 17, 2018 5:16 pm

Stock in Archer Daniels, The Andersons, or Cargill?

Doctor Rhythm
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Re: Long term investment in grains/wheat

Post by Doctor Rhythm » Thu May 17, 2018 5:28 pm

VTSAX

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ruralavalon
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Re: Long term investment in grains/wheat

Post by ruralavalon » Thu May 17, 2018 6:02 pm

over45 wrote:
Thu May 17, 2018 3:01 pm
If you thought grains/wheat was a good long term investment (over a period of 10-15 years), what would the best way to make an investment in it? Tks.
In my opinion grain futures (whether individual grains, or ETFs covering several grains) should only be used by professionals, like producers ( e.g. grain farmers) or users (e.g. large bakery companies, feed lots). This is not for amateurs. Do you even know how commodities futures work, or why they exist?
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mnnice
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Re: Long term investment in grains/wheat

Post by mnnice » Thu May 17, 2018 6:58 pm

aristotelian wrote:
Thu May 17, 2018 5:16 pm
Stock in Archer Daniels, The Andersons, or Cargill?
Cargill is a private company. 8-)

The prepper in me thinks maybe having a 100lbs that you rotate through ever year or two wouldn’t be the worst idea :wink

22twain
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Re: Long term investment in grains/wheat

Post by 22twain » Thu May 17, 2018 9:36 pm

Silk McCue wrote:
Thu May 17, 2018 3:09 pm
On a lighter note:

I would do wheat conversions to bread and eat the gains.
Or do a different kind of conversion, and drink them. :beer
My investing princiPLEs do not include absolutely preserving princiPAL.

bhsince87
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Re: Long term investment in grains/wheat

Post by bhsince87 » Thu May 17, 2018 10:16 pm

That would not be investing. It would be speculating.
Retirement: When you reach a point where you have enough. Or when you've had enough.

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whodidntante
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Re: Long term investment in grains/wheat

Post by whodidntante » Fri May 18, 2018 7:24 am

You can get direct exposure by buying and rolling a futures contract. There isn't anything you can buy and hold for 15 years that provides direct exposure.

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David Jay
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Re: Long term investment in grains/wheat

Post by David Jay » Fri May 18, 2018 8:06 am

whodidntante wrote:
Fri May 18, 2018 7:24 am
You can get direct exposure by buying and rolling a futures contract. There isn't anything you can buy and hold for 15 years that provides direct exposure.
As poster says, there is no practical way today to invest in the 2028 or 2032 wheat harvest.
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JBTX
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Re: Long term investment in grains/wheat

Post by JBTX » Fri May 18, 2018 8:29 am

Need to be careful when investing in perishable and consumable commodities. Often short traders tend to eat the lunch of long term futures holders who are forced to liquidate their positions. Look up contango.

http://www.etf.com/etf-education-center ... kwardation


https://absrresearch.com/the-commodity- ... ded-funds/

alex_686
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Re: Long term investment in grains/wheat

Post by alex_686 » Fri May 18, 2018 8:35 am

Become a farmer, invest in land.

Land has a few drawbacks. Lumpy, illiquid, requires skill, you become a small business owner overnight.

Not all investment thesis are actionable.

SagaciousTraveler
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Re: Long term investment in grains/wheat

Post by SagaciousTraveler » Fri May 18, 2018 10:01 am

I wouldn't.

The United States Food System is very complicated. Governments want to keep their agriculture, more so their basic commodities stable to avoid large swings in prices, shortages which would cause high prices. They do this by making sure the sector can produce enough to meet demands while keeping prices high enough to allot farmers to cover their costs and make a profit.

I can go into more detail but in summary I wouldn't bet on a market where the government doesn't want the price to high or to low (insurance payments would be paid). With such a narrow margin, what would be the gain?

magicrat
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Re: Long term investment in grains/wheat

Post by magicrat » Fri May 18, 2018 10:13 am

over45 wrote:
Thu May 17, 2018 3:01 pm
If you thought grains/wheat was a good long term investment (over a period of 10-15 years), what would the best way to make an investment in it? Tks.
If I thought this (which I don't), I'd buy farmland.

Nate79
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Re: Long term investment in grains/wheat

Post by Nate79 » Fri May 18, 2018 10:28 am

over45 wrote:
Thu May 17, 2018 3:01 pm
If you thought grains/wheat was a good long term investment (over a period of 10-15 years), what would the best way to make an investment in it? Tks.
I would invest in better research.

3funder
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Re: Long term investment in grains/wheat

Post by 3funder » Fri May 18, 2018 11:10 am

Don't do it. Just don't.

jayk238
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Re: Long term investment in grains/wheat

Post by jayk238 » Fri May 18, 2018 11:17 am

These posts are hilarious.
This along with some guy wondering if he should be a cpa or a surgeon as if all that happens in the end is some guy at a hospital getting paid big bucks and sitting on a chair.

Surgery is hard as is med school.

So is trading in commoddities thought not neary as hard but it is complicated.

Sometimes I wonder if these are troll posts.

Theres been an uptic of these lately. What gives.

not4me
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Re: Long term investment in grains/wheat

Post by not4me » Fri May 18, 2018 3:16 pm

over45 wrote:
Thu May 17, 2018 3:01 pm
If you thought grains/wheat was a good long term investment (over a period of 10-15 years), what would the best way to make an investment in it? Tks.
I'll echo what has been said -- no clean way to invest now in the 2028 wheat harvest. I'm not clear on exactly what you meant anyway. Are you saying invest in wheat for next 10 years? really open ended but that gives an idea of time horizon? Since wheat is perishable, each year somewhat stands on its own. If you think each year for the next 10 someone can profit, that is a different scenario. Maybe another way to ask is for more detail on what your theses is. Are you really thinking agriculture "in general"? exclude corn and/or soybeans? USA only?

Companies such as Archer Daniels Midland are likely best option; but not exclusive to wheat. There are reits, exchange traded products of sorts, futures, etc. depending upon what your target is. For me, they all have reasons I wouldn't use them.

Beehave
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Re: Long term investment in grains/wheat

Post by Beehave » Fri May 18, 2018 8:30 pm

Since you are writing about long-term investing, I'd surmise you are not interested in commodities trading but a more permanent aspect of agriculture.

I've looked into this a little bit, my thought being that if there is some future "black swan" event (inflation, deflation, or whatever), people will need to eat and whatever may happen to other investments, maybe agricultural interests will do at least as well.

My own research has been into farmland REITs and grain processors. Some names that come to mind are Farmland Partners and Gladstone (REITs that have actually been discussed and are searchable in this forum), and Archer Daniels Midland.

Gladstone does not seem to be interested in investing in grain farmland - - instead buying up berry and nut and other types of cropland.
As an aside, and maybe there's a lesson to be learned from the history somewhere inside here, in the times of the Iliad (circa 800 BC) farmers started converting from grain crops to tree (olive) and vine (grape) crops because they were more valuable and compactly shippable in trade than bushels of grain. The large Greek farms did much better than the smaller ones because the cutover required portions of lands being non-productive for a number of years. So many small farmers (and sharecroppers) got into such financial trouble that Solon was brought into power and he set the seeds of democratic government in Greece in motion as part of the solution to Greece's financial (agricultural) problems.

One thing to think about here is just like the technological changeover in ancient Greece, we now have nascent investment starting in "urban" or "vertical" farming. Will these new farms end up being disrupters to traditional grain and tree and vine farms and food processors? And is there an investment opportunity in this new technology?

I am interested in these topics but by no means an expert. I've been close to investing in a farmland REIT, but I've not pulled the trigger. I personally seem to do much, much better with mutual funds than with individual securities.

I wish OP the best and would be interested in anyone's thoughts about this.

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Re: Long term investment in grains/wheat

Post by Grt2bOutdoors » Fri May 18, 2018 8:50 pm

aristotelian wrote:
Thu May 17, 2018 5:16 pm
Stock in Archer Daniels, The Andersons, or Cargill?
Cargill is privately owned.
ADM makes most of its revenues from oil seed processing, corn refining, ethanol, commodity trading and flavors.

The Andersons? Think they are geared to corn?

How about Deere? You can’t plant crops without machinery.
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randomizer
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Re: Long term investment in grains/wheat

Post by randomizer » Fri May 18, 2018 9:05 pm

I'm happy with the exposure to grains/wheat that I get from investing in a total market index.
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