The soaring costs of grains, palm oil and chicken are forcing equity investors to rethink their positions as supply disruptions reshape the earnings outlook for companies. Profit estimates of global exporters like Singapore-listed Wilmar International and Hong Kong’s WH Group are on the rise while popular doughnut chain Krispy Kreme may take a hit from rising wheat prices.
From US-listed commodity traders to Thai poultry producers, equity analysts are lining up their bets on who will come off better – or worse – from the wave of food protectionism that’s sweeping across the globe.
Export curbs unleashed by Asian countries in recent days are causing a ripple far and wide, with local producers such as India’s Shree Renuka Sugars likely to be adversely affected. In contrast, global players which aren’t bound by these restrictions stand to benefit and this includes the likes of China’s Cofco Sugar Holding and Brazil’s JBS.
