There is an upward bias caused by several factors which will make shorting MON a position for only the brave or lucky:
1. Inflation. Government spending leads to bonds, which lead to quantitative easing, which lead to inflation of commodities prices... in other words, there is a direct (but delayed) correlation between government spending and agricultural price increases and profits. Historical data shows these correlations over and over again clear back to the Roman Empire. Commodities are always the last minute inflationary life-boat.
2. Developing Nations. As countries like China, India, (Brazil still has a lot of room to grow) and many other developing nations develop, they will move away from old farming techniques and embrace newer technology. We are only at the beginning of this trend.
3. Gold Bugs. We have already seen gold perform in the past as the single strongest performing area in recent years-- don't underestimate the power of these buyers who wish to hedge against inflation.
4. Rising Beef and rising dairy prices. Cows eat Monsanto products. As the price of beef and dairy continue to rise, more cropland will be put into corn and soy production. Hamburger consumption is at an all time high in the US, and has outpaced traditional sources, such that other parts of higher quality beef are being used to fill the demand for hamburger. US Beef trades for $20 per pound in China on the black market-- if a trade agreement is reached, US beef prices could triple. I suggest reading dairy industry trade magazines for more insights on this. China now has more McDonalds restaurants than the US... and 98% of the Chinese population has never even tasted cheese. China is Americanizing fast with no signs of slowing down. I suggest looking at the PE multiples of dairy related stocks in China. They are beyond insane. 100+!
5. Population explosion. I don't really need to explain this one, any schlameil with access to a graph of population growth in the last 100 years can see the trend. We are in a population explosion right now.
It should also be noted that the higher earnings multiple seen at present on MON is being influenced by investors who are betting on the company's long-term future.
