Overview

Agricultural commodities are natural resources that are generally consumed as part of a human diet, including Coffee, Cocoa, Livestock, Corn, Cotton, Soybeans, Sugar, and Wheat. While human consumption may be the best-known use for these commodities, they are often used widely in a number of other applications as well. Corn, for example, is used in everything from artificial sweeteners to fuel sources to papers and containers.

Agricultural commodities may be appealing as an investment for many reasons. These assets can serve as an effective hedge against inflation, since food prices are often among the first to rise when prices begin to climb. Agricultural commodities can also perform well when global populations are growing, or when a growing middle class leads to increased demand. Finally, agricultural commodities sometimes function as a hedge against volatility in equity markets; geopolitical tensions in emerging and frontier markets often arise as a result of food shortages.

There are a number of ways to invest in agricultural commodities, including ETFs, single stocks, and futures and options.

Agriculture Types

Agriculture In The News