I have been looking at grain processors like Archer Midland, Cargill, Wilmar and a few others (cant find any Aussie ones?).
Why is it that these companies benefit from rising grain prices? Surely the pricing power in the industry would lie with the farmers? Instead, it seems they are able to increase their margins when selling processed grain on to their customers (food processors). Can any farmers give a simple explanation?
This is the opposite of hard commodities. If the copper price rises, copper smelters that dont have captive supply get squeezed.
thanks in advance.
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