Last year I wrote that I felt Oil from Algae was the technology to watch.
Well Exxon is now investing $300 Million into research (Via SGI) in this technology. I consider Exxon to be "smart money".
SGI is harnessing photosynthetic microbes (i.e., algae) to produce a range of liquid fuels and chemicals directly from sunlight and carbon dioxide. Algae produce significantly higher amounts of biomass and oil as compared to terrestrial crops, can be grown on land that is not suitable for agriculture, can thrive in sewage or other types of waste water, and are efficient at capturing and recycling carbon dioxide, a major greenhouse gas.
Current methods to produce fuel from algae include processes that resemble farming. Algal cells are grown, harvested, and then bioprocessed to recover the lipids from within the cells. In contrast, in one of our solutions, SGI has engineered algal cells to secrete oil in a continuous manner through their cell walls, thus facilitating the production of algal fuels and chemicals in large-scale industrial operations. Our first product in this area is a biocrude to be used as a feedstock in refineries
Showing posts with label Agricultural. Show all posts
Showing posts with label Agricultural. Show all posts
Friday, July 17, 2009
Monday, December 31, 2007
There Is A Real Shortage Of Agricultural Stocks
To quote Don Coxe from his December 28, 2007 Conference Call;
"We have a shortage. There's more of a shortage of agricultural stocks than there is of soy beans. So this is a good time for investors in this group but it's always dangerous when you've had the kind of runups that these have had to say, "Well next year is still going to be a good year." But if you think back to what happened when oil came off $22 and started its way up. When you got to $50 oil there were fewer people on board to say that we could have a run from there.
So remember that adjusted for inflation these grain prices are still at trivial levels. What people have got to adjust to is the idea that a bigger and bigger part of total consumer expenditures in the world are going to have to go on food and that's being resisted all over the place. You had the elections in Venezuela and Russia where they froze food prices during the election campaign and then they're surprised when there's scarcity in the stores and that's one of the things that beat Chavez. He thought he could by just extending the imperial arm continue to deliver cheap food to the voters and the urban mob. He got fooled.
So the food story is one of genuine scarcity of food and of stocks but you're right. The biggest scarcity is in the stocks themselves."
I have been searching for agricultural stocks and its been difficult to find anything that has not all-ready doubled or tripled.
I have found one income stock called Cervus LP. It trades on the Canadian Venture Exchange with the symbol CVL.UN-X. It trades at $16.50 and pays a $0.09 monthly ($1.08/year) distribution (6.6% yield). This company owns some John Deere dealerships in Western Canada as well as some construction equipment dealerships. It to has a big run up and is very illiquid. You can find out more by clicking here.
You can read a transcript of Don Coxe's December 28, 2007 Conference Call by Clicking here.
"We have a shortage. There's more of a shortage of agricultural stocks than there is of soy beans. So this is a good time for investors in this group but it's always dangerous when you've had the kind of runups that these have had to say, "Well next year is still going to be a good year." But if you think back to what happened when oil came off $22 and started its way up. When you got to $50 oil there were fewer people on board to say that we could have a run from there.
So remember that adjusted for inflation these grain prices are still at trivial levels. What people have got to adjust to is the idea that a bigger and bigger part of total consumer expenditures in the world are going to have to go on food and that's being resisted all over the place. You had the elections in Venezuela and Russia where they froze food prices during the election campaign and then they're surprised when there's scarcity in the stores and that's one of the things that beat Chavez. He thought he could by just extending the imperial arm continue to deliver cheap food to the voters and the urban mob. He got fooled.
So the food story is one of genuine scarcity of food and of stocks but you're right. The biggest scarcity is in the stocks themselves."
I have been searching for agricultural stocks and its been difficult to find anything that has not all-ready doubled or tripled.
I have found one income stock called Cervus LP. It trades on the Canadian Venture Exchange with the symbol CVL.UN-X. It trades at $16.50 and pays a $0.09 monthly ($1.08/year) distribution (6.6% yield). This company owns some John Deere dealerships in Western Canada as well as some construction equipment dealerships. It to has a big run up and is very illiquid. You can find out more by clicking here.
You can read a transcript of Don Coxe's December 28, 2007 Conference Call by Clicking here.
Sunday, December 30, 2007
2008 Investment Recommendations
BASIC POINTS INVESTMENT RECOMMENDATIONS with my comments in italics at the end of each point.
1. Remain heavily underweight banks, particularly investment banks that have displayed monumental stupidity. Do not assume that a change at the top will automatically convert them into temples of wisdom, (unless it is accompanied by demands for the departing to repay bonuses based on bets that turned out disastrously). Better to assume that, like subprime-based CDOs, there are layers of rot that can make the entire product dangerous to your financial health.
Stay away from Canadian Banks for now. Especially the CIBC.
2. Remain overweight Emerging Markets, emphasizing those that are oil, gas,and/or food exporters.
I do not like investing in emerging markets.
3. Soaring food costs threaten stability for some Third World economies. We have been ardently endorsing India since we returned from our leave of absence a year ago. We are now more cautious, because a weak monsoon could be politically and economically destabilizing at a time of $4 corn and $10 wheat.
Stay away from Indian stocks or ETFs for now.
4. Remain heavily overweight gold—both stocks and the ETF. Gold is almost as good a protection against banking problems as SKF—the UltraShort Financials ETF—a security which may not be a suitable investment in some portfolios.
SKF-N is interesting or you can try HFD-T in Canada.
5. We continue to believe that the Agricultural stocks are the pre-eminent investment class of our time. Farm incomes are rising rapidly, and, in the US, farms and farm land are the real estate assets that are rising in value and are virtually immune to foreclosures. That means the leading Ag companies have great pricing power and minimal credit problems. We now hear suggestions that because food inflation has finally made it to the cover of The Economist, it is time to start moving toward the exits. Not so: We think that fine cover story could be the atonement—At Last!—for
the magazine’s famous 1999 cover: $5 Oil.
Look at CVL.UN-X
6. Remain overweight oil and gas producers, including the Alberta oil sands producing companies. As disappointed as we are with the new royalty schemes in that province, Alberta certainly remains more attractive than Nigeria or Angola—and much more attractive than Russia, Kazakhstan, or Venezuela.
Recommend COS.UN or how about HTE.UN?
7. We think it is time to begin accumulating the refiners that are equipped to handle heavy high-sulfur crude. The collapse of the crack spread has savaged refiners’ earnings, but that will eventually rebound. The Saudis have virtually turned out the Light, and less and less of the oil that the Gulf states will be lifting will be of the most desirable grades.
This makes Harvest Energy HTE.UN very interesting
8. Retain the base metals stocks that have long-life unhedged reserves in secure areas. Even if there is a global recession caused by global collapses of subprime paper and LBO loans, it will not be deep enough to drive base metal prices back to 2004 levels—but would be worrisome enough to push further mine development even farther into the future.
Take a look at MMP.UN-T
9. When borrowing, borrow where possible in dollars. When investing, invest where possible in other currencies.
Good idea.
10. Stagflation is a bad backdrop for bonds—and for non-commodity stocks. The central bankers could have headed it off had Wall Street behaved with a modicum of morality, but the Fed and its brethren are forced into sustained reflation because of the global solvency crisis. Corporate earnings for most sectors will not meet current optimistic Street forecasts, and rising inflation will reduce the market’s P/E.
Stay away from market index funds for now.
1. Remain heavily underweight banks, particularly investment banks that have displayed monumental stupidity. Do not assume that a change at the top will automatically convert them into temples of wisdom, (unless it is accompanied by demands for the departing to repay bonuses based on bets that turned out disastrously). Better to assume that, like subprime-based CDOs, there are layers of rot that can make the entire product dangerous to your financial health.
Stay away from Canadian Banks for now. Especially the CIBC.
2. Remain overweight Emerging Markets, emphasizing those that are oil, gas,and/or food exporters.
I do not like investing in emerging markets.
3. Soaring food costs threaten stability for some Third World economies. We have been ardently endorsing India since we returned from our leave of absence a year ago. We are now more cautious, because a weak monsoon could be politically and economically destabilizing at a time of $4 corn and $10 wheat.
Stay away from Indian stocks or ETFs for now.
4. Remain heavily overweight gold—both stocks and the ETF. Gold is almost as good a protection against banking problems as SKF—the UltraShort Financials ETF—a security which may not be a suitable investment in some portfolios.
SKF-N is interesting or you can try HFD-T in Canada.
5. We continue to believe that the Agricultural stocks are the pre-eminent investment class of our time. Farm incomes are rising rapidly, and, in the US, farms and farm land are the real estate assets that are rising in value and are virtually immune to foreclosures. That means the leading Ag companies have great pricing power and minimal credit problems. We now hear suggestions that because food inflation has finally made it to the cover of The Economist, it is time to start moving toward the exits. Not so: We think that fine cover story could be the atonement—At Last!—for
the magazine’s famous 1999 cover: $5 Oil.
Look at CVL.UN-X
6. Remain overweight oil and gas producers, including the Alberta oil sands producing companies. As disappointed as we are with the new royalty schemes in that province, Alberta certainly remains more attractive than Nigeria or Angola—and much more attractive than Russia, Kazakhstan, or Venezuela.
Recommend COS.UN or how about HTE.UN?
7. We think it is time to begin accumulating the refiners that are equipped to handle heavy high-sulfur crude. The collapse of the crack spread has savaged refiners’ earnings, but that will eventually rebound. The Saudis have virtually turned out the Light, and less and less of the oil that the Gulf states will be lifting will be of the most desirable grades.
This makes Harvest Energy HTE.UN very interesting
8. Retain the base metals stocks that have long-life unhedged reserves in secure areas. Even if there is a global recession caused by global collapses of subprime paper and LBO loans, it will not be deep enough to drive base metal prices back to 2004 levels—but would be worrisome enough to push further mine development even farther into the future.
Take a look at MMP.UN-T
9. When borrowing, borrow where possible in dollars. When investing, invest where possible in other currencies.
Good idea.
10. Stagflation is a bad backdrop for bonds—and for non-commodity stocks. The central bankers could have headed it off had Wall Street behaved with a modicum of morality, but the Fed and its brethren are forced into sustained reflation because of the global solvency crisis. Corporate earnings for most sectors will not meet current optimistic Street forecasts, and rising inflation will reduce the market’s P/E.
Stay away from market index funds for now.
Friday, December 28, 2007
Agricultural Stocks Are The Pre-eminent Investment Class Of Our Time
Don Coxe continues to believe that the Agricultural stocks are the pre-eminent investment class of our time. Farm incomes are rising rapidly, and, in the US, farms and farm land are the real estate assets that are rising in value and are virtually immune to foreclosures.
That means the leading Agricultural companies have great pricing power and minimal credit problems. We now hear suggestions that because food inflation has finally made it to the cover of The Economist, it is time to start moving toward the exits.
Not so fast.
In Don's December 19, 2007 Basic Points newsletter he makes an elegant argument of where we have been and where we are going. Don has been recommending Agricultural stocks for the last year and those that have listened to his advice have all-ready made some nice gains.
I will be emailing a copy of Don's December 19, 2007 Basic Points newsletter (this is only issued to Clients of Nesbitt Burns) on December 29, 2007. So if you haven't signed up for our free service then please do as soon as possible.
That means the leading Agricultural companies have great pricing power and minimal credit problems. We now hear suggestions that because food inflation has finally made it to the cover of The Economist, it is time to start moving toward the exits.
Not so fast.
In Don's December 19, 2007 Basic Points newsletter he makes an elegant argument of where we have been and where we are going. Don has been recommending Agricultural stocks for the last year and those that have listened to his advice have all-ready made some nice gains.
I will be emailing a copy of Don's December 19, 2007 Basic Points newsletter (this is only issued to Clients of Nesbitt Burns) on December 29, 2007. So if you haven't signed up for our free service then please do as soon as possible.
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