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From Kirsten Bischoff, Opalesque New York: Ejnar Knudson, Portfolio Manager at Craton Capital, which invests in a wide spectrum of public companies within the agricultural sector notes that US agriculture has thus far been insulated the global credit crunch.

Craton, which is flat through the end of the third quarter of 2008, is looking at the opportunities presented by falling agricultural equity prices. “The balance-sheet of the farmer and the farming economy is very strong. And there is not a lot of leverage with farmers and agriculture,” Knudson said.

Speaking to Opalesque from a road trip with over 30 farmers and agriculture bankers from the Midwest farm belt, Knudson noted that Wall Street’s perception of the credit crisis’ effect on US farmers may not be accurate.

“We reduced our shorts and significantly increased our long positions as Wall Street sold off the agriculture companies based on their concern over credit, as we see the fundamentals for agriculture are intact and the farmers in many parts of the US do not have credit issues.” In fact, Craton is looking to take advantage of such value plays as John Deere which has fallen 50% over the past month as Wall Street has sold it off on these same credit worries. The company, which has been out of the value play price range for the better part of the three years that Craton has coveted it, is finally in a space Knudson believes to be ripe for the pic......................

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