Sector Snap: Fertilizer Sector Gains

Farmers' demand for fertilizer has been "anemic" this spring, Juvekar said, but he thinks that is already reflected in the companies' stock prices. Investors are looking at farmers' economics in 2010 and beyond, he said, when their demand for fertilizers will likely rise, especially as farmers are significantly "under-fertilized" this spring after a "buyers strike" since fall 2008.

They can generally skip using the fertilizer potash for only a year without hurting yields, Juvekar said.

Furthermore, farmers in China and India, who traditionally set the tone for potash prices, aren't likely to achieve a big price reduction from last year, Juvekar said.

Shares of Agrium, which has been pursuing a purchase agricultural products company CF Industries Holdings Inc., rose $2.45, or 5 percent, to $51.30 in morning trading. Mosaic shares jumped $2.91, or 5.5 percent, to $56.26. Potash Corp. of Saskatchewan shares rose $4.53, or 4.1 percent, to $114.08.

Meanwhile, Terra Industries Inc. shares rose $1, or 3.4 percent, to $30.62. CF Industries Holdings added $1.87, or 2.3 percent, to $81.79. Bunge Ltd. gained $3.94, or 6.6 percent, to $63.29.