Following record commodity prices this year, index providers are on the lookout for more opportunities related to the commodities boom.
MSCI Barra, for example, has already developed the MSCI Agriculture & Food Chain indices, which are part of the MSCI Thematic & Strategy indices family.
The new indices are designed to measure the opportunity set represented by listed companies across the agriculture and food chain and include food distributors and producers of agricultural products, fertilisers and agricultural chemicals, and packaged foods and meats.
As such, they aim to provide a relevant equity benchmark for fund managers, pension funds and other institutional investors following an equity-based agriculture and food chain strategy and can be used for performance attribution, performance measurement and manager evaluation.
Rabobank International has meanwhile launched two new food and agribusiness (F&A) equity-linked indices focussing on Asian and global F&A companies to create benchmarks for investment opportunities emerging in the agriculture sector beyond commodities.
Rabobank’s RFA20 and RFG20 - Rabo Fastracks Asia Pacific Top 20 and Rabo Fastracks Global ex-Asia Top 20 respectively, which are part of the Rabo Fastracks index series - will focus on five F&A sectors that Rabobank has identified as the next era in global food and agribusiness: agri-inputs, agri-machinery and equipment, energy crops and commodities, food processing and protein. “The global food and agribusiness industry is set to undergo significant changes in the coming years,” says Brady Sidwell, assistant director of Rabobank’s food & agribusiness research and advisory department.
“Increased demand for food and animal feed as well as the growing use of crops for biofuels require greater deployment of scarce agricultural resources and have shifted the industry’s value proposition upstream.”
Elsewhere, exchange-traded commodities (ETC) provider ETF Securities announced that its physically backed precious metals platform is now Shariah compliant, meaning the ETCs provide investors with access to investments consistent with Islamic principles.
The Shariah compliance was sought in response to rising global demand for ETCs, in particular from the Middle East, North Africa and Asia. These ETCs - for physical platinum, palladium, silver, gold and a precious metals basket - are currently traded on five exchanges in Europe with trading volumes of $2bn (€1.36bn) in July.
ETF Securities already saw record daily inflows of $355m across commodities - including agriculture industrial metals and precious metals - into its ETC platform by mid-July.
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