I think the Hard Asset markets are getting frothy, and am looking for some hedges on my long positions. Terra Nitrogen is simultaneously long fertilizers (Urea) and short natural gas (its feedstock), with 64% of their expense in natural gas.
Like the uranium and coal markets, I believe agriculture chemicals are relatively inelastic to the price of the dollar, and nitrogen has another boost in that it is a feed component to corn, which has its own economics of ethanol production. If my view on colder winters and shorter growing seasons hold true, farmers will need to apply extra Urea to ensure rapid crop growth. These benefit TNH.
Terra - Nitrogen also pays out a 8.7% dividend through an MLP, and is 75% owned by insiders. This makes them shareholder friendly a nice source of cash while you await capital appreciation.
I have two buy areas, and will scale in at these points.
If you find value in my posts, a click on the ads would make my daughter very happy in her pursuit of a new bike for Christmas :-)