Australian Agricultural Company (AAC)

This is actually Australia's largest company, and its not the first time I have recommended this stock. Here is an updated chart after first recommending it on the 26th Sept 2007. In the wake of the sub-prime crisis, its held up very well like all commodities. What I like about this stock is:
1. Its a food commodity producer - beef - thats agricultural commodities, which are set to perform very well over the next 5-7 years. You have seen asset inflation, now watch as cost of living expenses like food go up whilst other 'asset' costs come down. Regardless of whether the Fed and other central banks attempt to keep asset prices high by further debasing their currencies, you can do no better than investing in such shares.
2. Recent rains: Farmers have just received some drought-relieving rains

3. Commodity prices are already going up - See http://www.abc.net.au/news/stories/2008/01/30/2149594.htm.
Looking at the chart we can see that AAC has consolidated above support at $3.00, but any buying above around this level is likely to pay off very handsomely. This is a good super fund stock. Buy heaps of them - why? They have 13 properties spread across NT-Qld-NSW, alot of them in areas where ABARE tells us that Australia has actually received higher amounts of rain than the rest. I drove from Darwin to Sydney (see trip) last Oct, and it was greener than Bathurst.
Looking at the map for "Rainfall comparisons for Australia - This year minus last year - 9 months" at http://www.bom.gov.au/cgi-bin/silo/rain_maps.cgi and playing with the parameters, its evident that farm prices are going up at a time when drought relief is well underway. The map suggests that the AAC areas of Qld are getting 300-600mm of extra rainfall compared to the drought period - whether you look 1,2 or 3 years ago.

Strategically very valuable land holdings! Robert Holmes a Court's son runs this company from memory. I think you will be looking at $10/share within 5 years, if not sooner, as currencies continue to be debased by another cycle of interest rate cuts, and as food price rises correct the product-money supply imbalance.

The reality is that alot of farmers are not aware of the surge in food prices they are just about to experience. If you are single I would be out drinking this weekend in Inverell or Dubbo trying to pick up a 'sheila'. Armidale is my preference for a educated girl. Or if the pickings are slim, or they are a bit full of themselves, the girls in the Philippines have a far greater sense of reality. Most of their boyfriends are alcoholics, gamblers, so you'll make a great impression. The Philippines is another food producer, albeit mostly for domestic consumption. Anyone want to go farming in the Philippines. Land is the most under-utilised commodity in this country, and with high rates on unemployment, and its English speaking. Cant think of a better place to build a farm? You might also recall my positive sentiments for the NZ currency about 8mths ago, well it relates to the current outlook for food commodity prices. So if you are desperate go to NZ by all means! Just make sure you're a alco before you get there to impair your judgement. The sheep will love you more than the locals.
Hmmm...makes we want to investigate more NZ food producers. Why? Currency advantage and greater stock selection in food I suspect. Anyone want to farm in the Philippines. I'm keen to grow mitake mushrooms, soybeans and avocados.
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Andrew Sheldon www.sheldonthinks.com