Matt Badiali on 3 Factors That Will Raise Fertilizer Prices

When Matt Badiali was young, he worked on a dairy farm for many years, and the farm is responsible for the man he has become. He learned three very important things from this experience, and they include the following:

  • He learned to stick with a job until it is finished
  • He developed an interest in the weather forecasts
  • He became obsessed with grains and fertilizer

People think that the third lesson is laughable. They can’t think of anyone else east of Illinois who can’t wait to read the updates on the farm conditions. The majority of the time, the news doesn’t make him want to do anything, but it’s different today because the news is giving us an investment opportunity.

Matt Badiali earned a Bachelor of Science in Earth Sciences from Penn State University. He also received a Master of Science in Geology from Florida Atlantic University. This education and training prepared him to inspect mines, oil wells and potential investment opportunities in Switzerland, Turkey, Haiti, Singapore, Hong Kong, Iraq and Papua New Guinea. His knowledge base gave him the ability to discuss properties with the CEOs of several companies.

Matt Badiali believes that he has to see the property before he can know whether or not it is a good investment. Because he is a geologist, he has been able to identify the red flags on a site. For this reason, he inspects the oil crews and finds out if they are competent. Being able to personally watch the drillers has given Matt the means he needed to make the right decisions. Matt Badiali’s knowledge of geology and the training he received as an investor work together to help him find investments that will give him the greatest profits.

What’s Going On with Fertilizer?

One agricultural news website’s headlines have been screaming that the prices of fertilizer are going up. These prices were increasing all through January and looked as if they would keep going throughout February. Nitrogen is one of the main ingredients in fertilizer, and its prices were leading the way. Another ingredient, potash, may be up even higher by the end of the year.

Gardeners know that potassium, phosphorus and nitrogen are three basic fertilizers, and today’s agricultural practices require the use of these ingredients. From December of 2017 to December of 2018, the following occurred:

  • Nitrogen increased by 20 percent
  • Potassium increased by 11 percent
  • Phosphorus increased by 10 percent

The larger fertilizer stocks are showing that the numbers mentioned above are true.

Matt Badiali states that fertilizer is a fantastic investment because agriculturalists really need it; it has the nutrients that they need to grow excellent crops. It is as necessary as electricity and oil. When nitrogen fertilizer was created, it became the most important innovation in the history of farming.

Fertilizer is a necessary commodity, but its prices are rising because of three other reasons. The three catalysts pushing fertilizer prices to the top are the following:

  • The rising demand
  • Bad weather
  • China

China

At the end of last year, fertilizer prices were crashing. The trade war with China was going strong, so American farmers allowed their soybeans to rot. China retaliated by placing a $27 billion tariff on U.S. farm goods, and it had a deleterious effect on the U.S. farm belt. The federal government responded by offering farmers $7.7 billion in subsidies.

Fertilizer stocks are getting the chance to climb higher again because the fears of a U.S./China trade war are dying down. China even sought to cool tempers by offering to purchase wheat, corn, soy and other agricultural products from the United States, and farmers will be extremely satisfied with that. The makers of fertilizer will like it too.

Bad Weather

There is another motivation for an increase in fertilizer prices. Last fall, we experienced bad weather. When the weather permits, farmers apply fertilizer to their fields and leave them until the winter is over. Because there was so much snow at that time, farmers couldn’t apply as much fertilizer to their fields. A large fertilizer producer is predicting that farmers will wait until spring to apply 80 percent of the fertilizer that they would ordinarily apply after the harvest.

Demand

The last incentive for rising fertilizer prices is the 2019 demand for grain. Bloomberg is predicting that the demand is going to be higher than the average. This will mean that the prices of soy, corn and wheat are going to remain in higher territory. Because the prices will be higher, farmers will be able to afford to buy more fertilizer, and demand will continue to rise.

Fertilizer stocks should give us a decent return. Matt Badiali suggests that you take advantage of this trend by purchasing the Global X Fertilizers/Potash ETF. In 2015, this stock was worth $12, and it is now up by 25 percent.

Other Opportunities for 2019

Fertilizer isn’t the only opportunity that investors will have this year. Last year, tax reforms led to a stronger economy, and Americans began to have confidence in it. Despite all of the good news, there is still a trade war between the United States and China, and the housing market is slowing down, so Wall Street is in the middle of a bear market. Even so, investors will be able to get into the market with some very promising stocks.

Twitter

It has taken some time, but Twitter is finally making a profit, and its stock price is up 10.2 percent. This is in the middle of a decrease in monthly use, but daily use is up considerably. Therefore, more people are using Twitter, and this will continue. President Trump is going to ensure that this is the case, but the active news cycle will also contribute.

TripAdvisor

TripAdvisor lost 75 percent of its value when it introduced its Instant Booking platform, so it switched its focus from hotels to restaurants and area amusements. This increased its revenue as it decreased its spending on marketing and advertising.

Costco

Costco was in danger of falling prey to what many other retail stores have had to endure, and it did look as if it would be one of the failures. Things turned around for Costco, and by the end of 2018, Costco was seeing more traffic walk through its stores’ doors. As a matter of fact, traffic has grown last year more than it has in a decade, and the stock made a major comeback. The extra boost that Black Friday sales gave it are largely responsible for the growth.

Chipotle Mexican Grill

After the E. Coli crisis hit, Chipotle Mexican Grill experienced bad times. By 2018, the company had a new CEO, and he was expected to move the company far away from the memory of the breakout. The good news is that CEO Brian Niccol did what was expected of him. He hired several executives to join him in the company and moved the headquarters to his home town. After Mr. Niccol launched a new ad campaign that focused on the new, real ingredients that Chipotle would be using, the stock climbed by double digits this year. The stock even did better than the rest of the restaurant industry.

Meet Matt Badiali at Stansberry Conference Series 2019, click here for more information >>