Generally, one would think wheat has little impact since it only appears in all kinds of human foods, but it represents only 58% of its global demand. The remainder is used in the production of biofuels and other derivatives for various industries, which explains the rise in its importance and the increased profitability of many companies involved in this sector.
This guide will analyze the top 10 best wheat stocks to buy and valuable information about this asset to consider when investing through our recommended broker.
In This Guide
The following is a list of the 10 best wheat stocks related to this industry available on our recommended eToro platform that can be invested in to generate profits today.
Based on the importance of wheat in the global economy, we will examine those ten stocks belonging to companies involved in wheat production and distribution and those directly or indirectly related to this commodity.
We will analyze key company information, indicators of importance, and how to locate each stock on our recommended broker, eToro. We have excluded other good wheat stocks such as MGP Ingredients Inc., Farmland Partners, Seaboard Corporation, and Arcadia Biosciences, among others, from consideration because they are not available on eToro. However, you may search for them in other brokers of your choice.
A global leader in food processing, Archer Daniels Midland Company, is one of the largest companies in the US. The company has operated a food processing plant, a grain elevator, and a transportation network for raw foods such as oats, milo, wheat, and barley since its foundation in 1902 in Minneapolis, Minnesota. Along with procuring raw materials, the transportation system also cleans, stores, and dispenses them to major consumers.
There are three segments within the company’s operations: Ag Services & Oilseeds, Carbohydrate Solutions, and Nutrition. By February 2022, the firm announced the pricing of its first sustainable bond, which will support initiatives relating to the company’s goals across the spectrum of environmental, social, and governance (ESG). The company will use the net proceeds from the offering to finance and refinance projects that meet certain criteria outlined in its Sustainable Financing Framework.
Archer Daniels Midland Company is listed on the NYSE under the ticker ADM. The company went public with a value of $42.39 and is currently trading at $95.71, resulting in a market capitalization of $53.19B. According to the main indicators of Archer Daniels Midland Company over the last 4 years, we have a gross margin of 8.51%, a net profit margin of 2.70%, an operating margin of 5.01%, and a return on investment 6.60%.
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Bunge Limited was founded in 1818 and has its headquarters in St. Louis, Missouri; it is an agricultural business and food company that operates worldwide. It sources, processes, and supplies oilseed, grain products, and ingredients. In addition to its agribusiness operations, the company has 4 more segments, including edible oil products, milling products, sugar, bioenergy, and fertilizers.
Investors should remember that Bunge is a diversified commodity company and is not a pure-play wheat company. This has resulted in a share price that has steadily increased year-to-date. Bunge provides sustainable solutions and opportunities to more than 70,000 farmers, as well as 31,000 employees globally who are responsible for more than 360 port terminals, oilseed processing plants, grain silos, and food and ingredient production and packaging facilities around the globe.
Bunge has been active in various ways, including announcing a joint venture with Chevron in September 2021 to meet the demand for renewable fuels and develop lower carbon intensity fuels; the company plans a sustainable production facility in the Port of Amsterdam for November 2021. It is expected that the facility will be completed in 2024.
Bunge stock is listed under the ticker BG on the NYSE. A few of the stats include that the company went public at $60.10 and currently has a $120.06, doubling its value and a market cap of $16.8 billion. Considering the last 4 years, we can share some important indicators: Bunge had a gross margin of 8.92%, a net profit margin of 0.82%, an operating margin of 6.84%, and a return on investment of 3.53%.
Andersons, Inc. was founded in 1947 as an agriculture company. The company operates grain elevators, trades grains, corn oil, ethanol, rents, repairs, and sells railway equipment. It is also based in Maumee, Ohio, and operates in North America.
The Andersons cultivate lasting relationships through extraordinary service, a deep understanding of the market, and a flair for adding value, as they have done for more than 70 years; they have 2,371 employees.
It trades on the NASDAQ under the ticker ANDE. It was trading for $44.98 and now has a value of $56.87, reaching a market capitalization of $1.85 billion. According to the main indicators considered over the past 4 years, it has a gross margin of 3.64%, a net profit margin of 0.72%, an operating margin of 0.24%, and a return on investment of 2.71%.
The CME Group is one of the world’s leading derivatives marketplaces. Its exchanges assist in risk management. This is certainly true for commodity markets, including wheat. Although technically, CME Group is not a “wheat stock” per se, given its role in the wheat market, it makes sense to at least consider it.
The CME Group Inc. offers trading on a broad range of markets, with the ability to trade in a wide range of asset classes, including agricultural products, currencies, energy, interest rates, metals, stock indices, and cryptocurrencies. The firm also provides traders with tools and resources, such as a market news feed and a trading education website.
CME Group Inc. is listed on the NASDAQ, where it trades under the ticker symbol CME. The company has launched with a per-share value of $78.93. Since then, it has nearly tripled in value and is now valued at $242.14 and has a market capitalization of $86.2 billion. Considering the last four years, we can see that the company has a gross margin of 79.39%, a net profit margin of 59.75%, an operating margin of 56.40%, and a return on investment of 9.12%.
As a provider of agricultural products, Corteva, Inc. has its headquarters in Wilmington, Delaware, USA, and serves clients worldwide, including the United States, Canada, Latin America, Asia Pacific, Europe, the Middle East, and Africa. It was founded in 1897, although the brand Corteva AgriscienceTM was not created until 2018. Also, it was originally part of DowDuPont but became a separate company in June 2019.
Technology solutions that focus on seed and crop protection enhance resistance against weather, diseases, insects, and weeds and improve food and nutritional characteristics. Corteva also works with producers worldwide to create an agricultural ecosystem that supports people, progress, and the environment.
CTVA is the ticker symbol for Corteva on the NYSE. Since it was launched in 2020 with a share value of $37.08, it has nearly doubled and now stands at $60.43 with a market cap of $43.42 billion. According to the main indicators over the last four years, the company has a gross margin of 36.67%, a net profit margin of -4.38%, an operating margin of 8.59%, and a return on investment of 0.62%.
The company was founded in 2004 and had its headquarters in Tampa, Florida. It operates internationally and, along with its subsidiaries, specializes in the production of phosphates and potash used in agriculture. Moreover, it collects urea for use in fertilizers through various international distribution networks, making this company the largest US producer of potash and phosphate fertilizers.
Mosaic is engaged in every phase of crop nutrition, from the mining of resources to the production of crop nutrients, feeds, and industrial products for clients around the globe, and today has more than 12,525 employees in chemical agriculture.
Mosaic’s stock trades on the NYSE under the ticker symbol MOS. Launched with a per-share value of $66.70, it is now trading at $75.37 and has a market cap of $27.22 billion. According to the main indicators of the last four years, we can find that the company has a gross margin of 26.04%, a net profit margin of 2.47%, an operating margin of 22.56%, and a return on investment of 2.23%.
Deere & Company is an international American company with operations in three segments: agriculture and turf, construction and forestry, and financial services. They are among the world’s leading providers of advanced products, technology, and services for customers who cultivate, harvest, transform, enrich, and build on the land to meet the growing needs for food, fuel, shelter, and infrastructure.
In its production and precision agriculture segment, the company develops and delivers global equipment and technology solutions to enhance the production and productivity of growers of large grains, small grains, cotton, and sugarcane. Similarly, the small agriculture and turf segment provides unique equipment and technology solutions to unlock value for dairy and livestock producers, crop growers, and turf and utility companies.
On the NYSE, Deer & Co. trades under the ticker DE, Originally, the price per share was $14.63, and it has now reached a value of $419.47, which is a growth of 28 times its initial value, which is reflected in the company’s market capitalization of $128.39B. Based on the last four years, we can find that the company has a gross margin of 29.71%, a net profit margin of 8.64%, an operating margin of 18.42%, and a return on investment of 7.54%.
Adecoagro was established in 2002 and is headquartered in Luxembourg. The company holds a variety of agriculture businesses in several South American countries, including Brazil, Argentina, and Uruguay. Its activities include farming crops, dairy operations, sugar production, land transformation, ethanol production, and energy production.
At the end of 2020, the company owned 220,186 hectares, including farms in Argentina, Brazil, and Uruguay, along with 241 megawatts of installed cogeneration capacity. It currently has 8,716 employees and is engaged in the agricultural commodities or milling industry.
It began with a value of $7.87 per share and is currently trading at $12.37, resulting in a slight increase in value per share, and its market capitalization is $1.43 billion. According to the main indicators for the last four years, we can see that it has a gross margin of 13.28%, a net profit margin of -0.59%, an operating margin of -4.16%, and a return on investment of -0.16%.
CF Industries Holdings, Inc. produces hydrogen and nitrogen products used in clean energy, fertilizers, emissions reduction, and other industrial applications. Based in Deerfield, Illinois, the company was founded in 1946 and operated worldwide.
The company’s segments include ammonia, granular urea, UAN, AN, and others and the company’s main product is anhydrous ammonia (ammonia), which contains 82 % nitrogen and 18 % hydrogen. With 3,000 employees, it belongs to the agricultural chemicals industry.
CF Industries is listed on the NYSE under the symbol CF. A share of this company in 2015 had a value of $59.33 and has since doubled to $109.69, so it currently has a market capitalization of $22.19 billion. In addition, considering the last 4 years, its main indicators include a gross margin of 33.91%, a net profit margin of 9.53%, an operating margin of 30.50%, and a return on investment of 6.64%.
AGCO Corporation is an American company that manufactures and distributes agricultural equipment, such as grain storage bins, high horsepower tractors, seed processing systems, ventilation, and water systems, among others. With headquarters in Duluth, Georgia, the company operated internationally and was founded in 1990.
GCO is a world leader in designing, manufacturing, and distributing smart agricultural solutions. In over 35 countries, they have more than 20,000 colleagues involved in delivering industry-leading technologies that solve real-world problems in the industry of trucks or construction (or farm machinery)
The AGCO stock is listed on the NYSE under the ticker AGCO. Its value per share was $51.33 in 2011, and it has achieved a value of $137.67 to date, accumulating a market capitalization of $10.23 billion. Considering its main indicators over the last four years, we can see that it has a gross margin of 22.52%, a net profit margin of 3.88%, an operating margin of 9.10%, and a return on investment of 8.33%.
Let’s take a closer look at some of the features to consider or values to ensure profitability when choosing wheat stocks now that we have reviewed in detail the top 10 wheat stocks available on eToro.
In recent months, wheat prices have been increasing exponentially, which has resulted in a rise in all companies that deal with this commodity, which, in turn, raised the stock price per share for each one.
By analyzing the data on the eToro platform, we can see that at the beginning of the year, the price of the commodity was at $637.50, reaching its maximum value on February 27th at $1,208.50, stabilizing at the date of writing this guide (April 13th, 2022) at $1,113.50. Also, with a 1-Year return of 76.56%.
We also assessed one of the main ETFs currently available, Teucrium Wheat Fund, with over 70 years of combined trading experience. With the help of the eToro platform, we can analyze the ETF’s values at the beginning of the year, which were $7.26, and it has now reached a value of $11.05, thereby increasing its value based on its 1-year return of 79.67%.
There is no doubt that all companies have high production costs concerning the profits that they can generate. Therefore, when choosing a company, it must have high profitability to generate earnings per share and dividends.
Afterward, it was possible to determine that in the wheat sector, the approximate cost of production per hectare would be $779, with direct costs of $552 and indirect costs of $227, and that per hectare, 3,028 kilograms of wheat could be produced. In the current market, the price of wheat is approximately $1.35, which means that when multiplied by the number of kilos per hectare and subtracting costs, a profit of $3308,8 would result.
We can see that these companies are quite profitable and provide a safe investment for individual investors to earn long-term profits. The companies would also need to sell 577 kilograms of wheat per hectare to break even.
In the wheat industry, wheat dividend stocks are equity securities of companies engaged in some aspect of agribusiness and which pay a regular dividend. Including farmers, manufacturers of farm equipment, processing plants for cleaning and packaging livestock, and chemical manufacturers responsible for developing crop fertilizers.
Companies with a track record of paying dividends at regular intervals are more likely to be established and at a more mature stage of their growth cycle, enabling them to return more earnings to their shareholders. In this regard, they can serve as a stable source of dividend income even if their stock prices decline sharply along with the overall market.
For example, Bunge Ltd has a dividend yield of 6.11% quarterly, which is within the list of companies we mention here. Other dividend yields include CF Industries’ 5.44% and Archer Daniels Midland Co.’s 4.81%.
Throughout this article, we have seen how this commodity is impactful and has a great potential for generating profits due to its strong historical background and great global demand for its nutritional value and as a derivative in other industries.
We will examine some variables that will determine the rationale behind whether it would be wise to invest in wheat in large companies through our recommended broker, eToro, to ensure we are on the same page.
The properties of wheat could support continued global demand growth due to crops of this variety being hardy and easy to grow. Unlike rice or other food commodities, it does not require much water or labor. In this manner, wheat could become the grain of choice in developing economies worldwide. Wheat also competes with corn for acreage.
The trend in biofuel production could result in a shortfall in wheat supply and higher prices. Additionally, due to the current state of conflict, where Russia and Ukraine are the largest exporters of wheat, its price will rise, and more companies will emerge to service this market.
Here are a few reasons why agricultural commodities remain an attractive investment: Over the past several years, agricultural commodities have performed better than the broader market; in terms of one-year trailing total yield, the best-performing ETFs were corn, wheat, and RJA, and among the top holdings of these ETFs are futures contracts for wheat, soybeans, and corn.
The chart above shows that the companies we are analyzing their wheat stocks for are generating profits and have a high market cap, indicating that prices continue to rise. To illustrate this further, if we examine the commodity for the last 3 years, wheat in 2019 had a value of $423 and to date in 2022 has a price of $1,093, which achieved double its value, and the maximum peak was reached on February 22nd, 2022 with a value of $1,208.06.
Many soft commodities, such as wheat tend to rise in price when inflation increases. For your information, inflation occurs when money loses its value over time, increasing the cost of living. Therefore, investing in wheat when inflation rates are increasing is a good way to protect or ‘hedge’ against it.
Wheat usually benefits from rising inflation, especially unexpected inflation, because within the increase in demand for goods and services, the prices of goods and services also rise, as do the prices of the commodities used in their production.
While many investors tend to stick to stocks, bonds, and shares, adding wheat is an excellent way to diversify a portfolio and include a commodity that is used all around the globe. By including wheat stocks in your portfolio, you can diversify your investments and strengthen your portfolio during difficult market conditions.
To begin with, you should note that the list of top 10 wheat stocks we reviewed above through our recommended broker, eToro, refers to very large companies. These companies have a long history in the market and substantial capital backing all of their operations.
Wheat penny stocks were created due to small and new companies wanting to finance their operations by issuing shares below $5 (US) or £1 (UK). In addition to its high volatility, this product is greatly influenced by market speculation, which is frequently manipulated, so you must be very well informed.
Here are the 2 best-known wheat penny stocks in this sector, all of which have experienced great market growth since their launch. Unfortunately, they are not part of eToro at the moment. Therefore, you should go to another broker to purchase them if you are interested.
S&W Seed Company (S&W) is an agricultural company that specializes in multi-crops and middle-market crops. This company specializes in breeding, producing, and selling agricultural seeds. In addition, the company is using its R&D to breed a wide range of products, ranging from pasture seeds to hybrid sunflower & wheat.
At present, this company has a value per share of $1.85, a market capitalization of $69,78M with a gross margin of 17.58%, and a revenue of $83.31M, and it is listed on NASDAQ.
Arcadia Biosciences, Inc. produces and markets plant-based health and wellness products. Among the company’s objectives is to develop crop improvements, particularly wheat, to enhance farm economics by improving crops’ performance in the field and their value as food ingredients, health and wellness products, and their viability for industrial applications.
At present, this company has a value per share of $1.09, a market capitalization of $24,30M with a gross margin of 24.68%, and a revenue of $6.78M, and it is listed on NASDAQ.
In this section of the guide, we have already covered all the relevant information about what stocks, the outlook for this commodity, and the companies that offer such a service.
So perhaps you are now wondering how you can invest in wheat stocks. So, let us examine in detail how you can get wheat stocks through the recommended broker, eToro; overall, the best place to buy wheat stocks.
eToro is considered the world’s leading social trading platform, offering thousands of short- and long-term investment options. It specializes in social trading with stocks, currencies, futures, options, and cryptocurrencies. In addition, eToro offers over 2,000 different financial assets that you can trade with or without leverage, and it is regulated by the FCA, ASIC, and CySEC.
In order to invest in wheat stocks in eToro, you must first open an account and provide all of the required information. Next, you must upload a copy of your ID which the platform will verify before you can deposit funds. Remember that the minimum deposit to begin trading is $10 in eToro, and you can do it from several sources.
As soon as you have the required funds, you may decide which of the 10 wheat stocks is right for you. All are available; also, eToro provides 24/7 customer service and a wealth of market information and research to assist you in making an informed decision. You also have the option to copy the trades of more experienced traders in the market if you wish to
As a part of this process, you must find the wheat stock of your choice in the eToro search engine and specify the operation you desire in the “Trade” button. You must also specify whether you wish to buy the underlying asset like a stock or a contract for difference (CFD) and a stop-loss if desired. Furthermore, you will be able to see the profits generated from your investments in wheat stocks over time.
In addition, any dividends paid by wheat stocks – most of which do – will be deposited directly into your eToro account when you invest in them; If you wish, you may reinvest your dividends back into the wheat industry or request a withdrawal. In addition, eToro supports hundreds of commission-free ETFs with wheat options for diversifying your portfolio.
A positive aspect of eToro is that there are no limits on commission-free trades, and you can purchase fractional shares. Consequently, as an eToro user, you will not pay any markups on the shares you buy, so the commissions will stay in your pocket and not go to your broker.
You can access thousands of stocks on this brokerage site. It includes not only the two leading US exchanges – the NYSE and NASDAQ but also 15 other international markets. We will mention a series of positive aspects of this platform regarding the options it offers to invest in wheat stocks.
As the global economy is currently in a state of expansion, the price of wheat, as well as the companies related to it, are cashing in on great profits, making it an excellent time to invest in stocks of this sector since wheat is a commodity that is growing and pays good dividends to its owners.
We recommend that if you are convinced that you wish to invest in wheat stocks, you do so through our partner eToro, where you can find the best wheat stocks and purchase them for 0% commission and a minimum deposit of $10, in addition to the use of the tools of copy trading, education, customer service and demo-account provided by the platform.
Russia accounts for 19% of global wheat exports, and Ukraine accounts for 9%, and the price of wheat is rising rapidly in response to the current situation, making it an excellent time to invest in wheat stocks.
eToro's best wheat stocks are Archer-Daniels-Midland Co with a market cap of $53.47B and dividends of 1.51, and Bunge Ltd with a market cap of $17.03B and dividends of 2.1. There are others with higher market caps but indirectly related to wheat, like Deere Co & CME Group.
Of course, all you must do is locate a broker who offers this service, and your choice of wheat stocks is available. eToro offers wheat stocks on 17 exchanges, including the NASDAQ and NYSE.
Certainly, it would be a good investment considering the current situation we are in, which increases demand for wheat and the fact that wheat is the second most-consumed food worldwide and has a stable market.
At eToro, you can buy and sell any of the 10 companies on our list of the 10 best wheat stocks for as little as $10 and with 0% commission.
You only need to create your account, verify it, deposit the required funds, search for the wheat stock option you want the most on the platform, and you can start trading then.
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