It has doubled in seven years, which, using the Rule of 72, equates to a 10.3 per cent compound annual growth rate. The dividend reinvestment decisions are all listed in the table shown here. The only new positions added were the iShares S&P/TSX Capped Energy Index ETF (TSX: XEG) at the bottom of the COVID crash, and South Bow Corp. (TSX: SOBO) which was a TRP spinoff. Otherwise, dividends went to adding to existing positions.

Over those seven years, the S&P 500 experienced four declines of 20 per cent or more, which defines a bear market. The 2018 decline was blamed on Trump tariffs and trade war No. 1. The COVID crash followed in 2020, then in 2022 we had a dramatic spike in interest rates coupled with an end of the 2021 speculative fervour, and in 2025 we have once again experienced a rapid decline and recovery due to Trump tariffs and trade war No. 2, although we still don’t know if the current one is truly over. Bear markets normally occur about once every four to five years, and having four in a seven-year period is highly unusual — although these all tended to be modest bears with quick recoveries.

The Canadian market mirrored the U.S., but didn’t quite hit the 20 per cent drawdown level, except during the COVID crash. Its overall market performance has been weaker but more stable.

What we’ve learned

• “Activity is the enemy of investment returns,” Warren Buffett is said to have said. This axiom naturally depends on good stock selection to begin with.
• An investor cannot — I repeat, cannot — pick the tops and the bottoms of these market drawdowns. One key to success is understanding and accepting they are going to happen but not reacting when they do, other than to look for bargains. This point also depends on good stock selection to begin with.
• An investor does not need to chase hot stocks to get good returns. If Nvidia or Apple were in the portfolio, it would have done better; however, the purpose of the portfolio was to demonstrate excellent returns with minimal effort, rather than to maximize returns.
• You can’t predict at the outset which stock will perform the best. If you could, you would invest in just that stock. The normal distribution curve (the bell curve) will always come into play.
• You can’t predict which stock will be the worst performer. A while back I wrote about my concern with declining profitability in the telecom sector. However, I would have never predicted seven years ago that Bell would slash its dividend in half, which it recently did. That said, having 12 out of 13 positions in the green is admirable.

I hope following this portfolio for seven years has helped with your investment decisions.

On another note, further to “The economic trouble with Canada” (Grainews, May 6, page 18): the Fraser Institute just published an analysis of Canadian public-sector expenditures and debt, compared to other developed countries, and once again our performance is abysmal. Over the past decade public sector expenditures, both federal and provincial, have grown from 38.4 to 44.7 per cent of gross domestic product (GDP), the second-worst performance of 40 countries. Our total debt has grown from 85.5 to 110.8 per cent of GDP, the third-most growth of the 40 countries. Recent provincial budget announcements will only exacerbate this performance, and the federal government has pledged to expand expenditures but won’t yet release a budget. Why we continue to elect profligate governments is beyond my comprehension. Burdening future generations will not fix today’s problems.

On top of declining business investment, declining per-capita GDP and rapidly increasing public-sector employment compared to private-sector, we now have the fourth splintered leg of our wobbly economic chair, being debt and deficits. These all occurred prior to current trade disputes, which will also be impactful.

The post The Titanium Strength Portfolio keeps plugging along appeared first on Grainews.

They are now stocking more parts and components on site because a lack of products caused major disruptions during the pandemic.

“I know it can be a challenge for producers, dealers and manufacturers to determine the right amount of parts inventory to carry on farm and in their respective businesses,” said Bob Cochran, general manager of Highline Manufacturing, which makes bale processors, feed mixers and other equipment at Vonda, Sask.

“I know of many manufacturers who significantly increased their inventory levels in response to the supply chain challenges post-pandemic, in part to ensure customer satisfaction.”

Cochran, who is also chair of Agricultural Manufacturers of Canada, said it’s a difficult balance to get right. Companies need parts to manufacture equipment, but they can’t keep everything in stock.

“The cost of carrying inventory has certainly increased for all involved,” he said by email.

“When we don’t have it on the shelf we expose ourselves to some level of risk of downtime and reliance on the supply chain to get it to us.”

The pandemic was a difficult time for equipment manufacturers and ag retailers as shutdowns and lockdowns interfered with the supply chain. Steel production, parts manufacturing, trucking and many other pieces of the system were disrupted.

The consequence was shortages and longer wait times for ag retailers and farmers for tractors, balers, seed drills and other equipment.

Not every manufacturer has returned to normal, but supply chains have improved, Cochran said.

“Lead times are reducing and shortages are fewer on many components, although not on all of them.”

Overall, ag equipment manufacturers in Canada are recovering, but different companies are in difference stages of recovery, he said.

“In all cases it takes time for the market to stabilize, and that is happening.”

The post Supply chain chaos eases at parts counter appeared first on Grainews.

Last month, Campbell Soup struck a $2.7 billion deal for Rao’s sauce maker Sovos Brands (all figures US$). Unilever bought premium frozen yogurt brand Yasso in North America, while Snickers maker Mars acquired healthy foods maker Kevin’s Natural Foods.

“There’s been a nice uptick in M+A (mergers and acquisitions) in the food industry in the first half of the year…,” said Michael Milani, executive managing director and principal at advisory firm Baker Tilly.

“It has been a big theme, and we expect that to continue in the back half of 2023 and into early 2024.”

This is despite higher borrowing costs straining companies looking for acquisitions.

The value of deals in the U.S. food and beverage industry slipped nearly three per cent to about $10.39 billion this year, according to LSEG data. But their volumes climbed 17.5 per cent to 248 as of Sept. 1, making the industry a bright spot in dealmaking.

The total number of deals across all industry sectors slid four per cent in the same period, data showed.

“Large food companies need to add more new concepts, new flavour profiles and new food items because their old brands — though still growing — are not growing at a meaningful rate,” Milani said.

The rise in deals comes as volume of sales at companies such as Kraft Heinz and Campbell fell for at least the past six quarters due to weak demand, while benefits from price hikes also fade.

“I would expect there to be a continued drumbeat of M+A,” said Sarah Henry, managing director and portfolio manager at Logan Capital Management, which holds shares in PepsiCo and Mondelez International.

Packaged food companies “are now faced with some difficult comparisons on organic (sales) and are seeking some strategic, category-specific M+A targets that will propel them through the next few years,” Henry said.

Cheerios cereal maker General Mills has pinned M+A as a key goal in the coming years, with executives saying it is a “good environment for M+A right now.”

For Mondelez, bolt-on acquisitions are the way to go, the Oreo maker’s finance chief Luca Zaramella had recently said at a Barclays conference.

Last month, Reuters reported that Twinkies snack cakes maker Hostess Brands was exploring a sale and that Mondelez and Hershey could be in the race to buy it.

J.P. Morgan analysts said they could be eyeing Hostess to expand outside of North America.

“Most of the large cap packaged food companies have … diligently reduced their debt and improved their balance sheet (through the pandemic)…so they have the risk capacity and risk appetite to pursue large-scale acquisitions,” CFRA Research analyst Arun Sundaram said.

“These packaged food companies need to continue finding ways to stay relevant … And so one of the easiest ways to do that is through M+A.”

— Reporting for Reuters by Deborah Sophia in Bangalore.

The post U.S. food companies go deal hunting as pandemic growth fades appeared first on Grainews.

The reweighting, which Statistics Canada carries out every year, has historically had only a marginal impact on the headline number. The new basket weights will be applied to May’s inflation data, due out on June 27.

The rebalancing reflects changes in 2022 compared to 2021. StatCan said the alterations were designed to take into account the continuing recovery from the impact of COVID-19.

“Spending that began to gradually shift back towards pre-pandemic patterns in 2021 continued and were more pronounced in 2022, with several sectors inching closer to pre-pandemic basket weight shares,” it said.

COVID-related measures and disruptions to supply chains helped push Canadian inflation up to a near-40 year high of 8.1 per cent in June last year. It has now dropped to 4.4 per cent, still more than double the Bank of Canada’s two per cent target.

Gasoline prices, pushed higher by increased demand as well as Russia’s invasion of Ukraine, will now account for 4.27 per cent of overall inflation, up from 3.47 per cent.

Gasoline is part of the larger transportation component which, for the second consecutive year, increased the most among the major eight segments, rising to 16.94 per cent from 16.16.

The food component expanded to 16.13 per cent from 15.75 per cent, reflecting increases in sales at restaurants as lockdown measures were removed.

But the shelter component dropped to 28.22 per cent from 29.67 per cent, in part due to lower costs for rent and other accommodation expenses as the housing market cooled.

DVD players were removed from the 2023 basket as they have become less popular with consumers following the advent of streaming services. Conversely, charcoal barbecues and snow removal equipment were added.

— David Ljunggren is a Reuters political correspondent in Ottawa.

The post Canada retools inflation baskets with more focus on food, gas appeared first on Grainews.

He said Brazil and the U.S., where JBS has meat facilities, are well positioned to meet China’s growing demand for beef as the major food importer reopens after COVID-19 restrictions.

“It is structural the growth in demand for beef in Asia as a whole, especially in China,” the CEO said.

He added that China is competitive in chicken and pork production, since these have shorter cycles, while for beef there is a need for more land and the production cycle is longer.

“Urbanization, rising income, these increase consumption,” Tomazoni told reporters. “Changes in habits after the pandemic (also) leads to an increase in beef consumption.”

On Tuesday, the CEO of poultry and pork processor BRF, Miguel Gularte, said he was optimistic about China’s meat demand returning to normalcy after the Chinese New Year celebrations.

Tomazoni cited forecasts that by 2050 the world will have to produce 50 per cent more food to meet global demand, also pointing to population growth as a factor driving consumption.

— Reporting for Reuters by Roberto Samora; writing by Ana Mano.

The post Beef consumption to rise in China, JBS predicts appeared first on Grainews.

Pork output in the world’s top producer of the meat reached 55.41 million tonnes, the highest since 56.71 million tonnes recorded eight years ago. The 2022 output compared with 52.96 million tonnes in 2021.

Output was boosted by high fourth-quarter production of 13.91 million tonnes, according to Reuters calculations of the data from the National Bureau of Statistics. That was up 0.87 per cent from the same year-earlier quarter despite a shortage of slaughterhouse labour due to COVID outbreaks.

Farmers have raised heavier hogs, hoping to benefit from an anticipated recovery in demand and prices, a factor that could have boosted output.

Demand had, however, remained tepid due to surging COVID-19 cases in China that kept many people at home, causing prices to plunge.

The data shows that China’s pork production has increased every quarter year-on-year for the last two years despite sluggish demand.

“I haven’t heard there’s much storage so it needs to be consumed already, which is difficult to explain,” said a livestock analyst, declining to be identified because of the sensitivity of questioning official data.

A rally in prices over the summer encouraged farmers to fatten pigs up more than normal to increase their profits.

Though it has declined, the average weight of live pigs was still on the high side at about 124.5 kg last week, according to analysts at Huachuang Agriculture.

That will continue to pressure prices, they said in a note published Sunday.

Meat consumption is set to improve after China’s reopening from a strict three-year COVID policy, with more group dining and business gatherings to support demand.

However, some believe pork consumption may not recover to the levels prior to China’s African swine fever outbreak that began in 2018, with many still cautious about crowded gatherings.

China’s beef output increased last year by three per cent to 7.18 million tonnes, the data also showed, while poultry output rose 2.6 per cent to 24.43 million tonnes and lamb and mutton increased two per cent to 5.25 million tonnes.

— Dominique Patton reports on agriculture in China for Reuters from Beijing.

The post China’s 2022 pork output highest in eight years appeared first on Grainews.

But the price rally was capped by investors looking to capture profits and adjust their positions before the end of the year, traders said.

“They’re backing off on what they want to hold and carry over into the New Year, even with both the dollar and crude oil being down,” said Karl Setzer, brokerage research lead at Mid-Co Commodities.

“That normally would be giving the grain market a boost, but not today,” Setzer said.

Wheat and corn eased from multi-week highs struck in the previous session, as traders awaited a clearer assessment of frost damage to U.S. wheat crops and as mounting COVID-19 infections in China tempered demand hopes.

Some participants booked profits after the rally in grains that may have been amplified by thin holiday volumes, traders said.

The most-active soybean contract on the Chicago Board of Trade (CBOT) ended the day up two cents, settling at $15.16-1/4 a bushel (all figures US$).

CBOT wheat closed the day down 11-1/2 cents, settling at $7.74 a bushel, while corn eased down 3-1/4 cents at $6.79-1/2 a bushel.

Crude oil fell as a surge in COVID-19 outbreaks in China created concern about short-term disruption, even as investors saw potential for a demand upturn next year as the country re-opens.

Drought in Argentina, the world’s largest exporter of soyoil and soymeal, is threatening prospects for next year’s soybean harvest. After less than expected rainfall last weekend in the country’s main growing belt, attention has turned to showers forecast in the week ahead.

U.S. wheat markets remained capped by Russian competition in export markets, highlighted by a purchase of 200,000 tonnes of Russian wheat by Egypt this week.

— Reporting for Reuters by P.J. Huffstutter in Chicago; additional reporting by Gus Trompiz in Paris, Michael Hogan in Hamburg and Naveen Thukral in Singapore.

The post U.S. grains: Soybeans firm as investors track Argentine weather appeared first on Grainews.

Corn also found support from uncertain weather in South America, while wheat lifted as trade kept monitoring freeze damage in the U.S. Plains.

The most-active soybean contract on the Chicago Board of Trade (CBOT) gained 25-1/4 cents to $15.14-1/4 a bushel, the largest daily gain for a most-active contract since Nov. 11 and the first close above $15 since June 23 (all figures US$).

CBOT wheat firmed 11 cents to $7.85-1/2 a bushel, while corn added eight cents to $6.82-3/4 a bushel, after reaching $6.83-1/2, the highest level for a most-active contract since Nov. 4.

Soybean futures continue to swing on South American weather models that call for rainfall in Argentina’s parched growing region.

“The longer-range models promise a forecast of rain, but then we get to that time frame and we get very little,” said Brian Hoops, senior market analyst at Midwest Market Solutions.

The relaxing of health restrictions in China has extended to food imports, as checks have been lifted on imported chilled and frozen foods, beginning Jan. 8.

However, there was also caution in financial markets about the short-term impact of China’s COVID policy shift, with a surge in infections straining hospitals and prompting some countries to consider new rules for Chinese visitors.

Wheat rallied in the past week as extreme cold weather gripped the United States, threatening to hurt winter wheat crops already weakened by drought.

“Those types of rallies tend not to last more than a few days, but this one has lasted,” said Arlan Suderman, chief commodities economist at StoneX. “The fact that the world balance sheet is as snug as it is has picked up a little bit more interest in the overseas markets.”

Gains were capped as Russia-focused agriculture consultancy Sovecon raised its forecast for Russia’s 2022-23 wheat crop estimate to 101.2 million tonnes, up from the previous estimate of 100.9 million tonnes.

— Reporting for Reuters by Christopher Walljasper in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.

The post U.S. grains: Soy firm on Argentina weather, China demand hopes appeared first on Grainews.

Cattle futures were firm, with strength in the cash market underpinning prices.

Weakness in Chinese markets spilled over to CME hog futures. China’s most active hog futures contract closed down 6.6 per cent at its lowest level since it was launched almost two years ago.

Concerns about rising COVID-19 cases in China following the easing of virus-related restrictions in the world’s top consumer of pork pressured hog markets.

Boxed beef prices rose on Monday, with choice cuts gaining $8.09, to $257.02/cwt, while select cuts rose $4.42, to $225.68/cwt, USDA said (all figures US$).

CME February lean hogs dropped 0.3 cent, to 83.7 cents/lb., bottoming out at 82.8 cents, their lowest since Oct. 14. Nearby December hogs edged up 0.375 cent, to 81.95 cents/lb., in thin trading ahead of the contract’s expiration on Friday.

The CME’s lean hog index, a two-day weighted average of cash hog prices, eased 48 cents to $81.99/cwt.

CME benchmark February live cattle gained 0.55 cent, to 156.1 cents/lb., while the spot December contract firmed 0.725 cent, to 154.4 cents/lb.

CME January feeder cattle eased 0.275 cent, to 183.65 cents/lb.

— Mark Weinraub is a Reuters commodities correspondent in Chicago.

The post U.S. livestock: CME February hogs hit two-month low appeared first on Grainews.

“With such geo-political stuff going on and a possible railroad strike [in the United States], it kind of disrupts the flow,” he said.

Capinegro pointed to China and its ongoing struggles with COVID-19 outbreaks– and now a measure of civil unrest there, with protests against the stringent lockdown measures. He warned China might be trying to frontload before the country has its holiday season early next year.

“They can blow things out of proportion and make the markets break,” he said.

Also, if there is a railway strike in the U.S., even for a couple of days, “it would hurt a lot of things,” he said, as so many products are dependent on rail movement.

Another factor Capinegro said markets will keep an eye on is weather in South America — specifically, how it affects corn and soybean crops.

Also, he said to watch Mexico’s moves regarding its ban on genetically modified corn that’s scheduled to start in 2024. Capinegro noted there have been some sizeable sales of U.S. corn to Mexico recently.

“Buyers could put it in a bin and store it,” he said.

Despite all that’s going on in the world and within the U.S., Capinegro said corn will likely remain largely where it is, “but soybeans are closer to the upper end of a good trading range.

“This wheat break we have had over the last few days has really helped our price in the world,” Capinegro said, noting how little news there currently is of the war in Ukraine.

Capinegro said he expects that pattern to hold at the CBOT following the next supply and demand (WASDE) report from the U.S. Department of Agriculture on Dec. 9, stating “it’s not a real market mover.”

— Glen Hallick reports for MarketsFarm from Winnipeg.

The post CBOT weekly outlook: Circumstances could mess with usual holiday lull appeared first on Grainews.