One of the arguments for investing in fertilizer stocks is that people always need to eat. Regardless of where you live, you need to stuff your pie-hole, and that means farmers need fertilizer to grow the crops.

As true as that argument may be, it doesn't seem to be applied to the food companies themselves. Investment decisions instead are based upon individual business characteristics. Kellogg will rise and fall based on the cost of wheat; Hershey is synonymous with chocolate and the nation's sweet tooth; and barring outbreaks of avian or swine flu, Tyson poultry and pork has a growing international business to diversify its domestic lines.

Yet food and beverage companies are seen as defensive stocks, investments you can flock to in times of worry precisely because of their universal nature.

Eat up!
Over on Motley Fool CAPS, the industry screener lists 103 stocks under "food & beverage," of which nearly half carry well-respected four- and five-star ratings. One that floats to the top is B&G Foods (NYSE: BGS), a maker of what it calls "shelf stable" food, but which you're probably familiar with because of its eponymous pickles, Ortega taco shells, and celebrity chef Emeril Lagasse's seasonings. It's grown its portfolio of brands through a series of acquisitions, most recently buying Unilever's (NYSE: UL) Alberto-Culver specialty brand division, which added the Mrs. Dash seasonings brand, Molly McButter, and Baker's Joy, but also included two atypical brands: anti-static spray Static Guard and furniture polish Kleen Guard.

Sales were up 20% last quarter as a result of those acquisitions, as they accounted for virtually all of the increase. Yet they also helped boost profits, since they were generally higher-margin products.

Like the cereal makers, one risk it faces is rising commodity costs. For the balance of 2012 it has contracts on its most significant commodities locked in at less than 2% of cost of goods sold. So even though the markets are seeing costs rise, B&G will benefit from its foresight. The problem comes when the contracts expire and are renegotiated, at which time we're likely to see substantial increases that may affect operations and performance.

I have to agree with highly rated CAPS All-Star EnigmaDude, who says that despite the run-up in its stock -- B&G's shares are up 34% over the past 12 months, but 80% higher from their October lows -- it carries a heavy debt load and "the potential upside from here is small relative to the downside risk." Add in the commodity repricing risk, and I've rated B&G to underperform the market indexes. But let me know on the B&G Foods CAPS page whether you think the stock still has some dash, and add the stock to the Fool's personalized stock-tracking service to see whether it still proves to be a defensive play.

Plowshares to swords
Argentinean agricultural giant Cresud (Nasdaq: CRESY) would seem to fit more neatly into the investment argument laid out at the start, but it carries a lot of risk these days because of the political upheaval engendered by the country's increasingly nationalistic policies. President Cristina Kirchner nationalized Spanish oil giant YPF; warned Barrick Gold and Vale (NYSE: VALE) that it had better figure out ways to start using more local goods instead of importing supplies; and pressured Telecom Argentina into suspending its dividend.

With its large landholdings, an essential agricultural business, a prominent real estate business, and a favorable dividend policy (Cresud's dividend currently yields 3.9%), it is a company ripe for falling into the grip of a Hugo Chavez wannabe.

Unlike peer Adecoagro (Nasdaq: AGRO), which has been suffering at the hands of a drought, Cresud says most of its farms are in areas unaffected by the La Nina weather pattern. But because it's subject to currency fluctuations brought on by Kirchner's disastrous economic policies, profits for the past nine months plunged 53%.

Yet with 96% of the CAPS members rating Cresud to outperform the broad market indexes, it appears they're expecting it to successfully negotiate the geopolitical landmines. I'm not so sure and have rated it to lag the indexes, but add the agribusiness to your own watchlist, and then let me know in the comments section below or on the Cresud CAPS page whether you believe it can survive the creeping nationalism.

The ball's in your court
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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.