Agribusiness stocks are a bright spot in an otherwise gloomy share market. Several have rallied this year as the lower Australian dollar, free-trade agreements and expectations of sharply higher food demand from Asia boost sentiment.
Organic food producer Bellamy’s Australia; almond grower Select Harvests; livestock-feed producer Ridley Corp; egg producer Farm Pride Foods; and Elders and Capilano Honey are among the market’s best-performing small-cap industrial stocks over one year.
Agribusinesses are prominent in the Initial Public Offerings (IPO) market this year. MG Unit Trust, which provides exposure to the Murray Goulburn dairy co-operative, raised $439 million. Australia’s largest fruit and vegetable producer, Costa Group Holdings, raised $550 million, and Beston Global Food Company raised $100 million.