Potash Corp. of Saskatchewan Inc. was not the only stock hitching itself to the meteoric price of those potash contract prices for China yesterday.
Various agriculture companies joined the party too, reflecting the global trend to increased meat and dairy consumption and what that means for
fertilizer and grain demand, as well as farm land prices.

Viterra Inc., the company formed from Sask Wheat Pool and Agricore United touched a 52-week high of $15.19, while western Canadian farm equipment distributor Cervus Inc. climbed almost 2.5% on the bullish potash news.

The Claymore Global Agriculture ETF, in which Potash Corp. has close to 10% weighting, rose as much as 2% on the day.
“Agricultural stocks are great because the demand for agricultural produce is so high,” said CIBC chief strategist Jeff Rubin. Junior potash players enjoyed a boost yesterday as well, with Athabasca Potash Corp. rising as high as 15% on news of the big jump in contract
prices.

Many market watchers say the global forces driving the huge increased inpotash contract prices are sustainable, and thus a boon to agriculture
stocks in general. But investors looking to join this party should bear in mind there is at least one counterweight on the horizon that could weigh on the sector’s fortunes: continued rising energy costs. As Mr. Rubin said, “agriculture is a lot more energy intensive a sector than
may meet the eye.”