ETF Trends
ETF Trends

The G8 Summit meeting made headway as President Barack Obama urged other leaders to help donate more money to the effort in sub-Saharan Africa. This could potentially affect agriculture and commodity focused investments such as exchange traded funds(ETFs).

The food plan initiative, part of the Group of 8’s Summit meeting, grew from a $15 billion project over three years to $20 billion. Peter Baker for The New York Times reports that Obama did clarify that whether or not developed nations have an obligation to help Africa, the continent of nations has to build “transparent, efficient institutions.”

Some of the highlights in the G8’s food plan, mentioned by Roger Runningen for The Age:

  • A three-year program of up to $20 billion  in agricultural investments to help the world’s poor farmers grow and sell more food
  • The initiative would be funded by G8 countries and international organizations, including the World Bank, along with other nations and emerging markets to help support the cause
  • A “shift” from food aid, this plan is intended to provide assistance to help the countries themselves  put in place the right policies to be able to produce food by themselves
  • Overall hunger reduction and creation of economic growth while sustaining producing natural resource bases

The effort could affect at least three ETFS, and potentially more if it proves to be successful:

  • Market Vectors Agribusiness (MOO): up 18.7% year-to-date; the plan could step up demand from producers

  • PowerShares DB Agriculture (DBA): down 7.6% year-to-date;  this ETF holds futures for the staples of diets around the world – corn, wheat, sugar and soybeans

  • E TRACS  UBS Bloomberg CMCI Food ETN (FUD): up 1.4% year-to-date;  tracks an index of 11 agricultural futures contracts and two livestock futures contracts. (Note that ETNs differ from ETFs).


For more stories about agriculture, visit our agriculture category.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.