seekingvalue

The Corn Shortage: Ideas for Investors

Another possible play here could be sugar. One of the main reasons sodas and other drinks are sweetened with high fructose corn syrup is that HFCS was significantly cheaper than sugar. But with corn prices up so much, sugar becomes competitive if not cheaper. (Sugar prices have been very low recently.) Some drinks have already switched to sugar (Sobe, Jones sodas). If demand for sugar picks up, Imperial Sugar (IPSU) should benefit significantly. IPSU is already a deep value pick (based on short term issues). If sugar demand picks up as a replacement for corn, it could really take off.