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2 Ways to Play the Agriculture Recovery

We expect a recovery in 2020, and these two stocks are poised to benefit.

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Seth Goldstein: The USDA reported that this year will have the lowest total acres planted in the U.S. in over the last decade as heavy rains in the spring left many fields flooded and unable to be planted. As a result, there will be lower near-term demand for U.S. agricultural inputs such as seeds, crop chemicals, and fertilizer. However, we view this as a temporary headwind and expect a full recovery in agricultural input demand in 2020. 

The lower plantings have weighed on ag stocks, providing attractive opportunities for long-term investors. We highlight Corteva and Nutrien as two of our favorite ways to play the agriculture recovery in 2020.

Seth Goldstein does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.