5 Agriculture ETFs Dominating the Markets | ETF Trends

Bad weather, poor crop yields and greater global demand for food are putting upward pressure on commodities. In addition to rising prices, the demand has pushed commodity exchange traded funds (ETFs) to the top of the heap.

The U.S. Department of Agriculture projects that consumer food prices will increase an average of 0.5% to 1.5% for 2010, the smallest gain since 1992, writes Katie Walker for Daily American. Pennsylvania Farm Bureau spokesman Mark O’Neill remarked that the main driver behind food prices is higher energy costs due to the supply chain. Increased demand for corn may start to affect meat prices in the coming months, since many farmers rely on corn as an animal feed. [Commodity ETFs That Are Beating Gold.]

The USDA estimates beef and veal prices to increase 2.5% to 3.5% while pork prices may increase 2.5% to 4%. Dairy products could jump 4.5% to 5.5% and egg prices may rise 2.5% to 3.5%.

The recent rally in soft commodities and increased global demand for food have helped agriculture businesses, reports Scott Eden for PBS. So far, crop failures, especially in Russia, and the USDA’s reduced yield estimates helped push the rallies in commodity prices.