CROP REPORT GIVES AG COMMODITIES LIFT

Shares of several makers of fertilizers and other agricultural commodities scored impressive gains in the session following a mixed reading on crop conditions from the government. The U.S. Department of Agriculture’s August crop report showed that experts continued to expect a robust harvest of corn and soybeans this year, though not quite as fulsome an output as had been suggested in the prior month’s report. Because of slightly drier weather than had been suggested in the July reading, both the corn and soy harvests are going to be slightly below the levels indicated in last month’s report. While a smaller harvest suggested scaled-back demand for fertilizers, those agricultural commodities makers generally are more dependent on how flush farmers are feeling then on simple exposure to the crops in the field. Besides, even with a modest pullback, 2008 is expected to be the second-largest crop on record. Corn and soy prices have both moved higher in futures trading. As a result, shares of Potash (POT) shot up 7% Friday, Agrium (AGU) also increased 7%, and Mosiac (MOS) increased 8%.