This was a banner year for corn yields, and the rising demand of corn for ethanol production has also kept the price of corn high. At the same time, however, there is some consensus among experts that in the coming years, the amount of farmland currently devoted to corn production will become lower as more acres are planted with soybeans instead. How can you, the investor, find the opportunity here? The answer lies in finding a company that helps farmers get more corn out of less acres, and Goldman Sachs (and I!) think that Monsanto Company (NYSE: MON), the world's leading producer of bioengineered seeds for the commercial farming market, is just that company.
Monsanto maintains its position as market leader by staying well ahead of its competition in the research and development of seed technology that create crops that are high yield, resistant to herbicide and bug resistant -- creating a product so advanced that many of the company's competitors choose to work with Monsanto, either via co-development deals or straight licensing of the technology, instead of trying to compete against it.
Above and beyond its seed technology, however, Monsanto is also dedicated, through its Agricultural Productivity division, to helping farmers get more out of the land they have while using fewer resources to do so on a wider scale. Through green pesticides, products to increase livestock yield and various solutions to invasive weed control, the company continues to seek new solutions to the problems of a world that will need to feed increasing amount of people from a limited amount of arable land.
So while there are those consumers who don't like genetically modified foods, there is clearly both an environmental and financial demand for Monsanto's products -- demand that should continue to grow for some time.
Type of Stock: Monsanto Company is the world's largest producer of seeds, including high-value-added, genetically enhanced seeds for soybeans, cotton, corn and other crops. Monsanto also produces a variety of agricultural productivity products.
Price Target: I believe that this one could easily hit $110 -- or higher by the end of 2008.
Hilary Kramer, author of the newly released Ahead of the Curve, is a financial editor and money coach for AOL and an authority on investing.










