Fertilizer Worries Keep the Ag Story Growing

Just when you thought the ag trade was over, you get a story on the front page of The New York Times that explains the vast worldwide shortages in fertilizers -- that, plus an overweening refusal by any powerful politicians to back away from ethanol.

Now it is true that the price increases in fertilizer are going to bring out new sources of potash that will make it so that Potash (POT - commentary - Cramer's Take), Agrium (AGU - commentary - Cramer's Take) and Mosaic (MOS - commentary - Cramer's Take) will not be able to increase prices endlessly, even though the increases are still additive to farmers because of the price increases.

And we can still see the ancillary gains: You need more new Deeres (DE - commentary - Cramer's Take) and more new seeds from Monsanto (MON - commentary - Cramer's Take) to make things better.

But in the end, the food shortage is controlling the pricing of ag worldwide.

Now, if the Times had not written the article about the fertilizer shortage, then you would have this group down, as it was going to trade with energy. Plus, these farm stocks trade as dollar plays -- even though I don't think they should -- so there is Fed exposure (unlike Apple (AAPL - commentary - Cramer's Take) and MasterCard (MA - commentary - Cramer's Take), as I wrote earlier).

Yet, what matters is we all must remember that the ag shortage is worldwide, not just in the U.S., and U.S. oil inventories should not control the trading in Deere and Monsanto.

Random musings: One after another infrastructure play is blowing up, as we see from McDermott International (MDR - commentary - Cramer's Take) and today Chicago Bridge & Iron (CBI - commentary - Cramer's Take). In the meantime, the traditional companies like SPX (SPW - commentary - Cramer's Take) and Ingersoll-Rand (IR - commentary - Cramer's Take) are blowing the doors off, in part because of the weak dollar. I, in particular, as you know from my show, like Eaton (ETN - commentary - Cramer's Take) and Parker-Hannifin (PH - commentary - Cramer's Take), which are high-growth stocks with low multiples. ... GM (GM - commentary - Cramer's Take) and Ford (F - commentary - Cramer's Take) are becoming more international, which is where the strength is. ... Still hate Garmin (GRMN - commentary - Cramer's Take), as it is now an average-selling-price story, and ASPs are coming down.. First Solar (FSLR - commentary - Cramer's Take) would be up $30 if oil were up today...

At the time of publication, Cramer had no positions in stocks mentioned.

ALL JIM CRAMER BLOG ENTRIES | POST A COMMENT | READ COMMENTS  

---

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for Action Alerts PLUS. Watch Cramer on "Mad Money" weeknights on CNBC. To order Cramer's newest book -- "Jim Cramer's Stay Mad for Life: Get Rich, Stay Rich (Make Your Kids Even Richer)," click here. Click here to order "Mad Money: Watch TV, Get Rich," click here to order "Real Money: Sane Investing in an Insane World," click here to get "You Got Screwed!" and click here for Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he appreciates your feedback and invites you to send comments by clicking here.

TheStreet.com has a revenue-sharing relationship with Amazon.com under which it receives a portion of the revenue from Amazon.com purchases by customers directed there from TheStreet.com.