Which investments will benefit from the drought / water crisis?

[Cheesekraft]

May be a bit heartless,but there is an obvious water shortage problem and the solutions don't seem to be adequate to handle it. What stocks will benefit from the crisis?

[docshock13]

Try www.exploitationinvestment.com. They specialize in making a profit from others' misery.

[DogNo1]

The way to exploit the water shortages is not clear since most water suppliers are not private businesses. The best play may be to invest in companies that make desalination plants and other peripheral equipment that is sold to governments.

[Jedsada3]

Invest in beer and coke!

[gk10002000]

Bottled water companies, local or imported?

[fvw53]

I tried for more than 10 years to introduce in Thailand a Belgian made soil conditioner which allows to save up to 50% of water consumption by plants in areas hit by drought (and also toxic elements) but the "experts" with office at Kasetsart Univ rejected it.

Now more than half of the product is sold in Australia since 20 years where the experts understand the difference between a soil conditioner and a fertiliser.

I am now more than 70 and retired but if somebody wants to try this again in Thailand then he or she should contact me privately

[JacChang]

The way to exploit the water shortages is not clear since most water suppliers are not private businesses. The best play may be to invest in companies that make desalination plants and other peripheral equipment that is sold to governments.

TTW and EASTW

However, from past experiences with water problems, these companies don't get any benefits. And the price of water doesn't just surge as it's a basic utility.

[Estrada]

Personally I like Inter Far East Energy(IFEC), a solar and wind power energy company which has a projected 212% upside. A dividend of 1.1% is envisaged for this year ending Dec 2016 and 3.5% for 2017. Three brokers have published their analyses on the SET Trade Web site (go to analysts consensus and click on download). One can envisage that there will be an increased demand for wind turbines and solar panels to power the proposed 4,600 submersible well pumps for the artesian wells that are going to be drilled as a matter of urgency to mitigate the drought. This company has recurring and rapidly increasing revenues from its power and hotel businesses. The price has already increased this month from B6.00 to B7.25 and likely to reach at least B12-13/share by the end of the year.

[The Deerhunter]

Well drilling, desalination, tanker truck hire near any uncontrolled fresh water source. and owning an uncontrolled fresh water source if you can find one Whatever you do you are not going to be popular with anyone. Perhaps we have a troll post here???

[Estrada]

The way to exploit the water shortages is not clear since most water suppliers are not private businesses. The best play may be to invest in companies that make desalination plants and other peripheral equipment that is sold to governments.

TTW and EASTW

However, from past experiences with water problems, these companies don't get any benefits. And the price of water doesn't just surge as it's a basic utility.

The government is not going to buy desalination plants, it is already going ahead with the drilling of 6,000 artesian wells, of which 4,600 are still to be completed. TTW and EASTW will not benefit, quite the opposite, income will drop due to water usage bans, restrictions and water conservation measures. So you should sell these shares.

[mfd101]

Well drilling, desalination, tanker truck hire near any uncontrolled fresh water source. and owning an uncontrolled fresh water source if you can find one Whatever you do you are not going to be popular with anyone. Perhaps we have a troll post here???

Not everyone is (as yet) short of water, or indeed unpopular. As I have mentioned in a previous post on water shortage, my family happens to live beside a hardly-at-all controlled fresh water lake which has fallen about 1" in the last 4 or 5 months. Fish ponds & ducks are doing very nicely.

[chilli42]

investing in water is not practical. It's difficult to ship and during a water shortage will be politicized. The best way to invest in water is to invest in food. Food best represents the underlying value of water, it's the value addition of water ... it takes a whole lot of water to grow the rice or feed the chickens that end up on your table. Food is easy to transport and does not get politicized.

[JacChang]

OH MY GOD. The settrade website just became ugly and unusable........ Was about to go give IFEC a review.

[Inuk]

Cheesecraft and other interested parties. If you would like a simple guide of the future for water not just locally but globally, I can send you a brief overview - [email protected]

Artesian wells - you still need to clean up the water for drinking and household use. Uncontrolled disposal of refuse and municipal solid waste does lead to contamination of the water tables.

Wells or boreholes are also subject to geophysical changes in below ground movement. Many boreholes even inland eventually become contaminated with salt deposits.

[PT4]

a Belgian made soil conditioner which allows to save up to 50% of water consumption by plants

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​I think you are talking about water-absorbing granules. If so, that's an excellent idea for investment, as well as good for the plants and crops.

[PT4]

Artesian wells - you still need to clean up the water for drinking and household use. Uncontrolled disposal of refuse and municipal solid waste does lead to contamination of the water tables.

Wells or boreholes are also subject to geophysical changes in below ground movement. Many boreholes even inland eventually become contaminated with salt deposits.

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"Desal" provides two good investment ideas in one post: well-drilling equipment and water treatment equipment. Thank you for posting about that.

[PT4]

investing in water is not practical. It's difficult to ship and during a water shortage will be politicized. The best way to invest in water is to invest in food. Food best represents the underlying value of water, it's the value addition of water ... it takes a whole lot of water to grow the rice or feed the chickens that end up on your table. Food is easy to transport and does not get politicized.

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​Interesting thoughts. I especially like your concept, "the value addition of water". Do you think we'll eventually see trading in "water futures"? I do.

[PT4]

Bottled water companies, local or imported?

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​Good idea. Also, manufactures of bottles that bottled water companies use. Or the machinery and resins to make those bottles.

[PT4]

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If you would like a simple guide of the future for water not just locally but globally, I can send you a brief overview - [email protected]

​​I've just finished reading the report sent to me by "Desalinator". For anyone interested in "water futures" it provides much food for thought. It may be the best answer here so far to the OP's question. Here is just one example (from the company website):

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... it is going to be cheaper to produce clean water on site than transport it.

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[blackcab]

What about investing in powdered water?

[Cheesekraft]

investing in water is not practical. It's difficult to ship and during a water shortage will be politicized. The best way to invest in water is to invest in food. Food best represents the underlying value of water, it's the value addition of water ... it takes a whole lot of water to grow the rice or feed the chickens that end up on your table. Food is easy to transport and does not get politicized.

true, but the relations are not exactly clear. If there is a drought, perhaps less rice can be grown, so the price of rice goes up. But, that does not mean rice stocks would necessarily rise would it? There is less being produced to counter the price rise. If there is less fruit being harvested, perhaps meat stocks rise? I don't see any clear sector benefiting from drought.

[PT4]

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Well drilling, desalination, tanker truck hire near any uncontrolled fresh water source.

Very good ideas. Thank you, DeerHunter. Secondary factors like that can offer big profit leverage for low investment.

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water ... It's difficult to ship and during a water shortage will be politicized. ... Food is easy to transport and does not get politicized.

Important to think about that: I would say that "difficult to do" -- anything -- is a good clue to potential profit.

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If there is a drought, perhaps less rice can be grown, so the price of rice goes up. .... If there is less fruit being harvested, perhaps meat stocks rise?

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​Deerhunter, Chilli42, and Cheesekraft are analyzing secondary factors. Difficult to do, but often where the most profit potential can be found (rather than the primary factor). This kind of discussion has a lot of value.

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​Chilli42 mentions an important point, "Food ... does not get politicized." Well, no; food often gets politicized -- example is price controls on many foods in many countries, including here in Thailand. But I could agree that food is politicized in different ways than primary factors (food vs. water), and often at different times. Those differences could provide opportunity for arbitrage profit, although I haven't figured out what that might be in this situation of drought.

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​It is tempting and easy to think in terms of stock market "sectors," as Cheesekraft mentions above. The problem with that is many other investors are thinking along similar lines. I prefer to think about profit potential far away from stock markets; not so easy to find as listed shares.

If somebody put a gun to my head and said, "Quick, tell me your best investment idea for this drought!", I would reply, "Buy a small plastics fabricating shop. Produce resin tanks that slide into the back of ordinary pickup trucks. Cheap and quick to design and build. Sell at low price, just cover costs of production and variable overhead. Run two or three shifts if needed. At the first hint that the drought would ease, sell the entire shop."

Or keep the shop and quickly switch production from water tanks to food harvesting/storage bins that also slide into pickup trucks. A few years after that, switch to small resin boats suitable for use in floods. Then rinse and repeat the cycle.

If someone were to point to a situation like that, I'd be tempted. But I'm not tempted by any investments, of any kind, in LOS. ("Land of Scams", isn't it?)

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Edited March 23, 2016 by PT4

[gk10002000]

If somebody was a good hydrologist, they might want to start a company or a consulting business and help point out to the Thais good places for building dams, reservoirs etc. I am a mechanical engineer so I know some of the basic generalities, but I don't work in that field and don't have any direct experience with large water projects. But it seems pretty obvious to me that some large scale reservoirs would help a lot and Thailand is very suitable for that. They get large amounts of rain, then they get periods without rain. In general there is probably plenty of water in a given year, it just comes and goes in bunches. Storage seems like an obvious solution? Of course after storage, you have to distribute from the reservoir, which implies, pipes, canals, water tunnels, or some type of distribution network.

[thaihome]

If somebody was a good hydrologist, they might want to start a company or a consulting business and help point out to the Thais good places for building dams, reservoirs etc. I am a mechanical engineer so I know some of the basic generalities, but I don't work in that field and don't have any direct experience with large water projects. But it seems pretty obvious to me that some large scale reservoirs would help a lot and Thailand is very suitable for that. They get large amounts of rain, then they get periods without rain. In general there is probably plenty of water in a given year, it just comes and goes in bunches. Storage seems like an obvious solution? Of course after storage, you have to distribute from the reservoir, which implies, pipes, canals, water tunnels, or some type of distribution network.

You do realize that there are well over 20 major dams and associated reservoirs in Thailand and no river is uncontrolled. The current drought situation is caused by the second year of an El Nino condition that has prevented those reservoirs from being fully filled during the abbreviated rainy seasons.

It appears the reservoirs were lowered excessively in 2013 in preparation for the rainy season after the floods of 2011 were caused by not lowering the reservoirs enough. Then the El Nino condition appeared and the levels have not been able to recover.

TH

[peeba7]

I would be very interested in cheap, easy to make, portable drinking water filters. When I think of how I might make a difference in this world, providing clean drinking water to the poor comes to mind. A different kind of investing but also could be profitable I imagine.

I am sure I am not the only one who has heard the wars of the future will not be fought over oil, they will be fought over water.

I saw a really weird episode of jesse venturas conspiracy theory program where the Chinese were buying up and shipping out fresh drinking water from the USA via boat.