This breed of livestock is capable of thriving in the toughest conditions – Could they help your portfolio do the same?

In times of instability and volatility, a little bit of steadiness is a welcome thing. While share markets are being eviscerated, it’s a good reminder that some things in life never go out of fashion.

In times of instability and volatility, a little bit of steadiness is a welcome thing. While share markets are being eviscerated, it’s a good reminder that some things in life never go out of fashion. Food is a necessity; it doesn’t have bad quarters, or huge declines in demand. This agricultural opportunity strikes at the heart of the issue of the coming food shortage. While markets are falling, the demand and furthermore, the need, for sustainable sources of protein is only growing.

For investors, the market numbers over the past few months make for grim reading.

The ASX has fallen to its lowest point since December 2016, on the back of a decline of 2.7% in US markets since the start of this year. This is particularly noteworthy given the record highs reached in early 2018 after corporate tax cuts were implemented.

European and Asian markets haven’t escaped the damage either, and global markets are projecting a gloomy outlook for the remaining holiday season. Yet given all the red numbers that investors are seeing, there’s one asset that no one is suggesting will be lacking in demand:

Food.

Take the price of lamb in Australian supermarkets. Very rarely does it deviate too far from the standard price of about AU$10/kg. Demand for food, and protein in particular, isn’t just constant, it’s constantly increasing. This means that the demand for livestock that is efficient at producing and reproducing is consequently growing too.

While US investors are increasingly speculating about a potential recession, and bracing themselves for this week’s anticipated Federal Reserve interest rate hike, the global need for a secure food supply isn’t going anywhere.

In times of market fluctuations reacting to political and economic instability, Dorper lambs will be untroubled by these market developments. Instead, they continue doing what they do best – putting on 250g per day and reproducing.

Whilst cattle take approximately 5 years to double their herd size, Dorper lambs can achieve this in just one year.  They also perform very well in Australia’s arid conditions, with Dorpers having high fertility rates that produce twins in an extraordinary 70% of pregnancies. The little ones won’t be little for long though; Dorper lambs only take 6 months to reach full maturity whereas cattle take around 18 months.

Investors seeking to shelter themselves from the tumultuous latter half of 2018, and prospect of a turbulent beginning to 2019 could consider an investment opportunity which provides exposure to Dorper lambs and the AFF Regenerative Farming Fund. Click here to request the details.

 

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