The ING Group, a global financial institution, released a 2023 outlook for commodities as 2022 has begun to wind down. ING noted that more volatility could be ahead for the commodity markets in general, but agricultural commodities are skewed to the upside next year.
No doubt it’s been a wild ride with the CBOE Volatility Index exceeding 100% in the early innings of 2022 amid Russia’s invasion of Ukraine. In turn, the Bloomberg Commodity Index has risen 17% for the year as record inflation continues and supply constraints have hit agricultural commodities.
“Agricultural commodities have also seen significant strength this year, particularly grains, due to the disruption in Ukrainian exports along with poorer weather in a number of key growing regions,” ING said. “These markets are going to remain sensitive to developments in the Russia/Ukraine war.”
“However for now, we believe risks are skewed to the upside,” ING added. “There are some early signs that the winter wheat crop in some key growing regions will be smaller next season, whilst clearly for agri crops in general, yields could suffer due to less application of fertilisers, given the strength in the market this year.”
Get Broad Commodities Exposure
To play continued upside in agricultural commodities, consider a broad-based exchange traded fund (ETF) such as the Teucrium Agricultural Fund (TAGS). Whether it’s for a continued inflation hedge or to simply diversify a portfolio with more alternative assets as commodity prices push higher, a broad-based fund like TAGS is worth considering.
For investors looking for agriculture exposure who don’t know where to start, Teucrium can fill a void, offering investors an easy solution. Getting exposure to commodities doesn’t mean investors have to hold various positions.
Investors can have it all in the convenience of TAGS. The fund combines exposure to corn, wheat, soybeans, and sugar through other Teucrium ETFs that focus specifically on these commodities, essentially offering investors a fund of funds.
The fund includes the Teucrium Wheat Fund (WEAT). To get that broad exposure, TAGS also includes the Teucrium Corn Fund (CORN), the Teucrium Soybean Fund (SOYB), and the Teucrium Sugar Fund (CANE).
“The Teucrium Team has over 70 years of combined trading experience,” Teucrium noted on its website. “Since our founding in 2010 Teucrium has exclusively offered access to alternative markets through ETFs. We revolutionized the way commodity ETFs are structured by tailoring our funds according to the unique characteristics of each underlying market.”
For more news, information, and analysis, visit the Commodities Channel.