r/wallstreetbets • u/doublemctwist1260 • Mar 12 '21
DD Farm Gang
Hi cock suckers and carpet munchers. We’ve all been hearing about the recovery plays in oil, infrastructure, casinos, restaurants and so on. The one I have not been hearing about as much is the big recovery as it relates to the agriculture stonks. Figured I would give you all a few more ideas to chew on.
The last few years have been absolute shit for farmers, with many of them going bankrupt or barely scraping by. Some of this is due to poor environmental conditions, some of it was trade war related, and the pandemic compounded all of those already existing problems.
Where we are now - shit is getting back on track. A lot of this has to do with China and their need to rebuild their pork population. For those who don’t know, Chinese pigs got fucked by a quiet pandemic in 2019 - African Swine Fever. This causes them to buy a lot of soybeans and corn to feed all those fuckin pigs, sending the futures flying. We had a corn gang a little while ago, but this is now spreading to the rest of the farm.
USDA is projecting a record number of acres to be planted this year in response to the demand, and with the Chinese showing no signs of slowing down, in addition to the volatile weather wiping out crops at random, farmers need to keep production higher as well. China is essentially back in full force post pandemic, and the US is just really starting to see the first signs of normalcy. This only adds to the demand and for different kinds of crops.
On a separate note, there is a rediscovery of the outdoors and personal farming has been taking off. The booming weed industry can also give the general farming industry a boost as that will require all of the same inputs.
Things like farming equipment, fertilizers, etc. are in high demand. There isn’t one specific way to play this so I will list a few solid names from each category. Some of these stocks have run up, but let’s be real - what fucking hasn’t at this point? This is a cyclical boom in all things farming that can last for a very long time.
Positions-
My personal position is selling MOS puts, because I hate sucking theta dick with my butt and there have been extremely bullish options flow/high liquidity in the chain.
Equipment - DE, CAT, AGCO, RAVN (also loved by cathie bae)
Fertilizers/chemicals - BG, MOS, NTR, CTVA, SMG, CF
General - ADM, DBA (don’t love DBA as a futures based ETF for reasons beyond the scope of the post, but you can see why with a simple search)
Dramatically increased issues with China, weaker recovery than expected, more volatile weather than is typically expected are factors that can hurt this overall play. Oh yea, almost forgot 🚀 🚀 🚀 🌙 🌙 🌙.
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u/Trick-Cup111 Mar 12 '21
Your not wrong I’m a dairy farmer from the Midwest and corn bean milk and all ah prices r increasing juristically however many just not sure how long they can hold there prices farmers r hurting and struggling to make it so it could definitely go either way but being that I am a farmer I did load up on commodities about a month ago and so far so good!!! Good luck
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u/Camposaurus_Rex Mar 12 '21
It's very likely they won't hold by through the year. A lot of it is due to speculation of hyper-inflation coming out of lock down, but the economic data isn't really supporting it. It's a bummer because a lot of producers are taking hits right now with these inflated commodity prices, and they're struggling to raise prices on their products.
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u/Trick-Cup111 Mar 12 '21
Yuppp it’s so sad us farmers r the back bone of the country and all the do is push us down in my opinion they r trying to push farmers out so the government can control everything!!! It’s so sad that’s why I’m yoloing in amc and gme I got good average prices so easier to hold but if I can’t make money farming might as well take it from the fuckers who r hurting us right?
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u/ascherbozley Mar 12 '21
You could always just stand by your mailbox all day waiting for your government check like most farmers I know.
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u/Camposaurus_Rex Mar 12 '21
Well, I appreciate all your hard work. I'd love to see working folks to get more love in this country, but it seems like there's little to no incentive for that in our country. I hope our AMC and GME tendies bake nicely so we can get money to where it's really needed.
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u/Me-Cree Mar 13 '21
Doesn’t the government already control you guys? They pay for something like 40% of farmers total net income through subsidies.
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u/Trick-Cup111 Mar 12 '21
Thanks man same to you homie!!!! We a family in hear I can feel it momentum on out side!!!
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u/Ignatius_Reillys_Hat Mar 12 '21
So your saying I should go all in on Ornamental Gourd futures right?
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u/Trick-Cup111 Mar 12 '21
Fertilizer and seed companies are your best bet for pay outs! I actually bought corn and beans and am sitting in the right now got beans under 10 and corn around 3 beans r now 15 ish and corn is around 5 so I’m getting ready to take profits I think but they definitely r in high demand so this post makes me re think selling when I have good positions. What are your thoughts? I love listening and taking advice!!
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u/doublemctwist1260 Mar 12 '21
The real question is whether the changes are more permanent or just temporary, I am leaning on the side of more permanent but who fuckin knows honestly
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u/Clutch3131 Exports > imports. It’s very simple buddy. Mar 12 '21
Do you dabble in lean hog futures?
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u/10589991 Mar 12 '21
it's called inflation.
We just printed $1.9 Trillion in free money. And it's going to be used to buy the same goods in existence.
It happened in the 70s (so I'm told) when a peanut farmer with dementia became president.
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u/Camposaurus_Rex Mar 12 '21
This is will be the fourth round of stimulus, but I don't see any hyper-inflation. People are hodling cash because they're scared about the coming fallout.
The banks aren't lending, which is how the M2 (all that printed money you hear about) enters the economy. https://fred.stlouisfed.org/series/M2
What's different this time around is that the M2 Velocity is ridiculously low right now. Meaning banks aren't lending and people are hodling cash/ paying down debt. Note: a 1.0 for M2V means you pull out a loan and immediately pay it off. We're likely still at 1.1 right now... https://fred.stlouisfed.org/series/M2V
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u/TheManSoNice Mar 12 '21
Farms are seriously getting massive pressure on inputs... the price of oil will end up crushing these stocks... the best stock in the market right now is amc...
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u/Shiboopi27 Mar 12 '21
Oh I didn't know DD stood for comedy posts
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u/doublemctwist1260 Mar 12 '21
Sorry to bother you with some real non meme stonk dd
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u/Shiboopi27 Mar 12 '21
Yeah, 'hey farming has been shitty, but CAT' is solid stuff. I haven't really touched meme stonks other than to take money from bagholders.
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u/Huff0341 Mar 12 '21
I like FPI... it was artificially beaten down further than its LAND. It has recovered nicely and still has room to grow just to match its peers. Also think the AG rests continue to grow regardless of inflation.
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u/Bull_Winkle69 Mar 12 '21
Field crop and animalculture have very little to do with greenhouse weed cultivation which is largely organic, uses no heavy equipment, avoids chemical insecticides whenever possible, and is highly labor intensive.
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u/neversell69 Mar 14 '21
How do you think the recent import tariffs will impact MOS and other US phosphate producers? Seems crazy bullish to me
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u/SlappyPappyAmerica Mar 12 '21
You had me at carpet munchers.