Giving Ag, Potash, and Fertilizers A Second Chance (MON, POT, MOS, IPI, AGU, CF, MOO)

Monsanto Co. (NYSE: MON), Potash Corp. of Saskatchewan, Inc. (NYSE: POT), Mosaic Co. (NYSE: MOS) and Intrepid Potash,Inc. (NYSE: IPI) are all recovering at least some from yesterday’s major drops.  While Agrium Inc. (NYSE: AGU) and CF Industries Holdings, Inc. (NYSE: CF) are lower again, the declines are minuscule compared to yesterday’s reaction to the news.  Even the Market Vectors Agribusiness ETF (NYSE: MOO) is trading up marginally.  These stocks were crushed yesterday by word of lower demand and lower prices over at K+S in Europe.

Monsanto Co. (NYSE: MON) is at $82.65, a gain of almost $1.57 after a smaller drop yesterday. Monsanto has more diversified operations so it will not correlate quite as much to the news reactions of today and yesterday. Potash Corp. of Saskatchewan, Inc. (NYSE: POT) is at $96.43, a gain of $0.57 after this one fell by more than $11.00 yesterday.  Mosaic Co. (NYSE: MOS) is trading at $46.50, a gain of $0.25 after this one fell almost $5.00 yesterday.  Intrepid Potash,Inc. (NYSE: IPI) is trading at $27.00, a gain of $0.67 after yesterday’s drop of more than $2.60.

Agrium Inc. (NYSE: AGU) is actually one of the standout losers today in the sector as shares are down $0.88 at $41.91 after falling by more than $3.00 yesterday.  CF Industries Holdings, Inc. (NYSE: CF) is down also by only $0.18 with its shares at $74.30, and that is after shares fell by more than $4.00 on Wednesday.

You will want to pay close attention to the Market Vectors Agribusiness ETF (NYSE: MOO) that tracks the stocks in the sector.  It is trading up $0.45 at $34.51, and that follows a drop of $1.31 yesterday.  This ETF is actually right back above the 50-day moving average of $33.89.

Right now traders trying to figure out if yesterday’s move was too much.  Some of these stocks are still up 50% from the lows at the peak of the market selling in early March.  Traders today are trying to position themselves ahead of any news confirming or refuting the weak demand and weak pricing.

Jon C. Ogg
June 18, 2009