Investing in Wheat Stocks

The world is still grappling with high inflation, and prices of basic food commodities, such as wheat, have fluctuated significantly in recent years. Russia’s war with Ukraine -- one of the world’s top wheat producers -- has compounded the problem.

Some countries are also facing low crop yields because of droughts, floods, and other weather events. When the delivery of grains and other essentials is disrupted, wheat prices can soar.

What does it mean for investors? Owning businesses that produce wheat or service the food commodity industry could be a hedge against inflation, that insidious force that can lower the value of investment returns over time. Here’s what you need to know about wheat stocks.

Deere and Co., better known as John Deere, is one of the most iconic U.S. farming companies. It manufactures tractors and other equipment, including combine harvesters.

In recent years, John Deere has been investing in technology to help with the automation of farming. Early in 2022, it unveiled a fully autonomous tractor that can go about its activity based on predefined functions while a farmer monitors its progress from a mobile device.

Given the cyclical costs of wheat and other agricultural goods, as well as a steadily growing global population that needs to be fed, adding automation to increase crop efficiency may be a big need in the coming decades.

2. Archer-Daniels-Midland

Archer-Daniels-Midland may not have the brand recognition John Deere does, but it is no less a giant in the agricultural industry. ADM helps manage the supply chain of food ingredients. It acquires basic commodities (including wheat), refines agricultural products into cooking ingredients, and resells and transports goods.

The company has faced significant disruption in the global food supply in the last few years, with the war in Ukraine putting further strain on supply chains. More recently, it's dealt with issues from global price declines for certain crops due to oversupply.

The company has also been working to regain investor confidence since 2024, when management announced that ADM had discovered multiple accounting errors, including improper recording of sales between different business segments within the company. Management had to issue restated financial statements and lower its profit outlook.

While the impact of these accounting issues should be resolved with time, investors should watch closely as the company works to regain its growth trajectory in the coming quarters. It is still reporting earnings declines and working to manage costs.

On a more positive note, ADM is a solid dividend stock for investors looking for investment income. Given the stock's less-than-favorable performance of late, the yield has been pushed up to just shy of 4%.

Bunge is another agribusiness that serves to link farmers and producers of basic consumer staples. Wheat milling is among Bunge's many food businesses, which it then sells and transports as food ingredient products.

As with other midmarket supply chain businesses, Bunge is also a developer of food technology and ingredients. This is a lucrative part of the food industry. Since its 2001 U.S. initial public offering (IPO), Bunge's sales and profitability have been cyclical, but it's been able to dole out a faithfully rising dividend through the years. It yielded 3.4% based on share prices in August 2025.

4. Seaboard

Seaboard is another food supply chain business that deals with the trading and overseas transportation of agricultural commodities. Among the commodities it deals with are wheat and other grains.

This multinational agricultural stock has been around for a long time and has a notoriously high stock price (currently almost $3,500 per share) because the company has never approved a stock split.

Regardless, Seaboard has managed to generate significant sales for decades, even as profits have fluctuated. Its dividend yield is on the lower end at less than 1%, but the company pays an annual dividend of about $9 per share.

MGP Ingredients is best known for its wheat, barley, and rye distillery products used in the production of alcohol, such as bourbon and other spirits. Additionally, MGP produces grain products for use in food, such as wheat starches.

Historically, MGP has been a cyclical business. Its sales are dependent not just on demand from its food and spirits customers but also on the market price of basic agricultural commodities.

6. The Andersons

The Andersons is another supply chain agribusiness. It buys and sells basic commodities and produces renewable fuel, such as corn-based ethanol. Since it deals in commodities, The Andersons has also been a highly cyclical stock.

This means that the company's top and bottom lines can fluctuate heavily based on the operating landscape. However, the company has grown its profits through the years and delivered solid cash flows.

The company has also steadily paid a regular dividend for many years and raised it for 28 consecutive years. The stock currently yields about 2%.

7. Adecoagro

Adecoagro is the only actual farming company on this list. A South American operation that produces wheat and other basic staples, it completed its U.S. IPO in 2011. The low-cost producer of grains and other agricultural products has been reporting strong revenue growth lately. It is also profitable, although its bottom line has struggled in recent quarters as weather issues and lower prices have adversely affected its Sugar, Ethanol & Energy business.

As a basic commodity company, investors should know that Adecoagro's stock can be volatile. However, it does have a policy of distributing a significant amount of its prior year adjusted free cash flow to shareholders in the form of a dividend. The stock yielded approximately 3.8% in August 2025.

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Pros and cons of investing in wheat stocks

There are numerous pros and cons to consider when it comes to investing in wheat stocks, either through direct ownership of shares in companies involved in the wheat industry or indirectly through exchange-traded funds (ETFs). On the pro side, here are some points to consider:

• Wheat stocks can help diversify your portfolio, as they don't necessarily mirror the movements of other asset classes like stocks and bonds. Some wheat stocks may also be exposed to other crops or business segments, further enhancing your portfolio diversification.
• Investing in wheat can potentially act as a hedge against inflation, as commodity prices tend to rise during inflationary periods.
• Global population growth and increased demand for livestock feed, which includes wheat, contribute to a strong demand for wheat, potentially driving up prices and benefiting wheat-related companies.
• When demand is high or supply is constrained, the price of wheat and wheat-related stocks can increase significantly, offering the potential for substantial returns for long-term shareholders.
• Many wheat stocks are associated with well-known brands that consumers are familiar with, which can make them a comfortable choice for buy-and-hold investors.

At the same time, there are also some cons to be aware of before you put cash to work in this space.

• Wheat prices are subject to volatility due to factors like weather conditions, crop yields, geopolitical events, government policies, and currency fluctuations.
• Investing in individual stocks, including wheat-related stocks, carries inherent risks and unpredictability, since the performance of a company depends on factors beyond wheat prices.
• While wheat stocks can offer potential for high returns, especially during specific periods, their performance can fluctuate year to year depending on various market dynamics.
• Like any investment, there's a risk of losing money if the market moves against your investment or if the underlying companies perform poorly.

As always, whether you want to put cash to work in wheat stocks or other adjacent businesses, it is best to work towards building a well-diversified portfolio of 25 or more quality stocks across various sectors. That way, you can benefit from the growth profiles of a multitude of businesses in a wide range of market environments.