July 21, 2011

AgIndex Declines in Second Quarter 2011

An index of 21 publicly traded companies that deal with agriculture declined by 6 percent in the second quarter of 2011. The 6 percent decline in the AgIndex compares to a .5 percent increase in the S&P 500.

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The decline in the AgIndex during the second quarter was the first decline in the AgIndex since the second quarter of 2010. During the second quarter of 2010, the AgIndex declined by 20 percent. Before the 2010, the last time the AgIndex declined was in the first quarter of 2009. The 2009 decline was a continuation of declines occurring during the last half of 2008 that were participated by the 2008 financial meltdown.

Declines of companies within the AgIndex were widespread. Of the 21 companies in the AgIndex, 18 had their stock values decline during the second quarter of 2011. The AgIndex is composed of five sectors. All sectors had declines: the first processor sector had a 10 percent decline, the fertilizer sector had a 9 percent decline, the equipment sector had an 8 percent decline, the crop protection sector had a 2 percent decline, and the seed/genetics sector had a 1percent decline.

Unlike in previous quarters since 2007, the 2nd quarter AgIndex decline is not accompanied by a decline in the S&P 500. More information on the AgIndex can be obtained at Performance of Publicly Traded Agricultural Firms Since 2007.

Issued by Gary Schnitkey and Clay Kramer
Department of Agricultural and Consumer Economics
University of Illinois

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