Agriculture exchange traded funds (ETFs) are benefiting from the rising prices of harvested goods. Last week, wheat, corn, soybeans, sugar and cocoa all increased in prices because of high demand for U.S. supplies, due to bad weather in other global crops, Tony C. Dreibus for Bloomberg reports. In addition, global supplies of grains continue to lag demand. The higher wheat costs are causing cereal companies such as Kellogg (K) and General Mills (GIS) to boost prices.
Wheat futures for December delivery rose 1.7% on the Chicago Board of Trade after reaching an intra day record of $9.46. Agriculture futures have more than doubled in the past year. The PowerShares DB Agriculture (DBA) ETF invests in futures on wheat, soybean, corn and sugar. Currently, it’s up 9.0% for the last three months, since it launched in January. The latest agriculture ETF, Market Vectors Agribusiness ETF (MOO), is up 4.1% for the week, since it launched in late August.
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