Financial Times | 16 November 2010
Abu Dhabi has been working on a food security strategy and is building silos in Fujairah. "If you really want food security, either you buy a piece of farmland overseas or you build your own trading house," a London-based commodities banker told FT.
FT [1] via Zawya.com
By Javier Blas and Jack Farchy in London and Andrew England and Roula Khalaf in Abu Dhabi
Abu Dhabi is to make a bold foray into commodities with the establishment of a government-owned trading house aimed at securing food supplies for the import-dependent nation and capturing profit margins in metals and agriculture trading.
People familiar with the plans say the company, which is called Abu Dhabi Sources or ADS, is likely to be started with a capital base of several hundred millions of dollars.
ADS will be going up against well established trading houses, including Glencore, the world’s largest commodities trader, Minneapolis-based Cargill and Louis Dreyfus of France.
Bankers and traders in London and Geneva, Europe’s trading hubs, say headhunters have approached metals and agriculture traders in the past three months seeking senior staff to build up ADS. It is not clear if ADS will trade in oil.
Abu Dhabi, home of 95 per cent of the hydrocarbon reserves of the United Arab Emirates, has embarked on ambitious plans to transform itself into a global city, with infrastructure projects that could cost more than $300bn and require huge imports of raw materials.
Food security has risen to the top of the agenda in the Middle East and North Africa – the world’s biggest importer of cereals – following the food crisis of 2007-2008.
Policymakers are worried about surging prices, but more importantly about exporting countries’ trade restrictions – such as Russia’s halt on wheat shipments – which make importers vulnerable to an interruption in supplies.
Commodities prices have rocketed in the past six years on the back of strong demand from China and other emerging markets.
Copper prices hit record highs last week, becoming the first industrial commodity to break above levels set in 2008.
Abu Dhabi has been working on a food security strategy and is building silos in Fujairah, a smaller member of the UAE.
The move is designed to secure the flow of imports even in the event of a disruption in the Strait of Hormuz, the Gulf’s key waterway, which could be affected by any military confrontation with Iran.
“If you really want food security, either you buy a piece of farmland overseas or you build your own trading house,” a London-based commodities banker said.
Abu Dhabi is not the first country to build a domestic trading house, although its plans appear more ambitious than other, more limited, state-owned trading enterprises, such as Badan Urusan Logistik, or Bulog, of Indonesia.
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NEWS - Commodites, Agriculture, Green Investment - NEWS
11/12/2010
Gold, Agriculture Are `Safest Long Positions,' Deutsche Bank's Lewis Says
By Jae Hur and Ichiro Suzuki - Nov 11, 2010 Precious metals including gold and agricultural commodities may extend gains in the coming months as a declining dollar and tight supplies boost demand, according to Deutsche Bank AG.
A lot of agricultural commodities including corn, soybeans and wheat are “still cheap” even after recent rallies, Michael Lewis, global head of commodities research, said in an interview. The surge in gold, which touched a record this week, is not yet extreme, Lewis said yesterday in Tokyo.
Commodities have jumped this year on increased demand as the U.S. emerged from recession and China, the world’s largest metals user, led expansions in Asia. Copper, used in pipes and wires, reached an all-time high today. Grains and soybeans have rallied on higher demand, trade curbs and poor harvests.
“The safest long positions to have are in precious metals and agriculture,” Lewis said in the interview, referring to bets that prices will advance. For gold “the magnitude of this rally to us is not extreme,” Lewis said.
Immediate-delivery gold has gained 28 percent in 2010 and is set for a 10th annual gain as the dollar has dropped. The precious metal touched a record $1,424.60 an ounce on Nov. 9. Corn has gained 42 percent this year on speculation hot, dry weather in August hurt crops in the U.S., the world’s biggest exporter. Cotton reached a record $1.5195 a pound yesterday.
Gold Bulls
Lewis’s call for higher gold prices echoes forecasts from other investors and analysts including Jim Rogers, who has said it may jump to $2,000 an ounce over the long term. Myles Zyblock, chief institutional strategist at RBC Capital Markets, said last month gold may soar to $3,800 within three years as it follows the pattern of previous “investment manias.”
Gold would need to rise to more than $1,455 an ounce to surpass its all-time high in real terms as measured by producer prices, Lewis said, according to a copy of remarks to clients in Tokyo today. Adjusted for changes in consumer prices, the metal would need to advance to $1,880 an ounce to reach the level seen at the beginning of the 1980s, he wrote in the remarks.
“The gold price would need to hit $2,100 to represent the most powerful rally in percentage terms, and surpass the 1976- 1980 gold-price rally, when prices surged by just over 720 percent,” Lewis wrote in the speech.
Bond Buying
Gold has surged as the U.S. currency has dropped, investors have boosted holdings through exchange-traded products and central banks including India’s have added the metal to their reserves. The dollar has fallen as the Federal Reserve expanded a program to buy bonds to bolster growth in the largest economy.
The Dollar Index, which tracks the currency against six major counterparts including the euro and the yen, traded today at 77.625 compared with this year’s high of 88.708, which was set in June.
“We expect investors’ flows into gold exchange-traded funds will accelerate, as well as efforts by the Fed to devalue the dollar,” Lewis wrote in the speech to clients. Exchange traded funds, of ETFs, trade like stocks, enabling investors to buy precious metals and other products without taking delivery.
Central-bank gold holdings rose by about 500 metric tons last year and may rise again in 2010, the first time they have been net buyers since 1988, Lewis said in the speech. On current trends, central-bank buying in 2010 will surpass private-sector inflows into physically backed ETFs, Lewis said in the speech.
Central banks in India, Bangladesh, Sri Lanka and Mauritius have bought gold this year and in 2009 from the International Monetary Fund, which said last year it was putting 403.3 tons of bullion up for sale.
A lot of agricultural commodities including corn, soybeans and wheat are “still cheap” even after recent rallies, Michael Lewis, global head of commodities research, said in an interview. The surge in gold, which touched a record this week, is not yet extreme, Lewis said yesterday in Tokyo.
Commodities have jumped this year on increased demand as the U.S. emerged from recession and China, the world’s largest metals user, led expansions in Asia. Copper, used in pipes and wires, reached an all-time high today. Grains and soybeans have rallied on higher demand, trade curbs and poor harvests.
“The safest long positions to have are in precious metals and agriculture,” Lewis said in the interview, referring to bets that prices will advance. For gold “the magnitude of this rally to us is not extreme,” Lewis said.
Immediate-delivery gold has gained 28 percent in 2010 and is set for a 10th annual gain as the dollar has dropped. The precious metal touched a record $1,424.60 an ounce on Nov. 9. Corn has gained 42 percent this year on speculation hot, dry weather in August hurt crops in the U.S., the world’s biggest exporter. Cotton reached a record $1.5195 a pound yesterday.
Gold Bulls
Lewis’s call for higher gold prices echoes forecasts from other investors and analysts including Jim Rogers, who has said it may jump to $2,000 an ounce over the long term. Myles Zyblock, chief institutional strategist at RBC Capital Markets, said last month gold may soar to $3,800 within three years as it follows the pattern of previous “investment manias.”
Gold would need to rise to more than $1,455 an ounce to surpass its all-time high in real terms as measured by producer prices, Lewis said, according to a copy of remarks to clients in Tokyo today. Adjusted for changes in consumer prices, the metal would need to advance to $1,880 an ounce to reach the level seen at the beginning of the 1980s, he wrote in the remarks.
“The gold price would need to hit $2,100 to represent the most powerful rally in percentage terms, and surpass the 1976- 1980 gold-price rally, when prices surged by just over 720 percent,” Lewis wrote in the speech.
Bond Buying
Gold has surged as the U.S. currency has dropped, investors have boosted holdings through exchange-traded products and central banks including India’s have added the metal to their reserves. The dollar has fallen as the Federal Reserve expanded a program to buy bonds to bolster growth in the largest economy.
The Dollar Index, which tracks the currency against six major counterparts including the euro and the yen, traded today at 77.625 compared with this year’s high of 88.708, which was set in June.
“We expect investors’ flows into gold exchange-traded funds will accelerate, as well as efforts by the Fed to devalue the dollar,” Lewis wrote in the speech to clients. Exchange traded funds, of ETFs, trade like stocks, enabling investors to buy precious metals and other products without taking delivery.
Central-bank gold holdings rose by about 500 metric tons last year and may rise again in 2010, the first time they have been net buyers since 1988, Lewis said in the speech. On current trends, central-bank buying in 2010 will surpass private-sector inflows into physically backed ETFs, Lewis said in the speech.
Central banks in India, Bangladesh, Sri Lanka and Mauritius have bought gold this year and in 2009 from the International Monetary Fund, which said last year it was putting 403.3 tons of bullion up for sale.
11/11/2010
From corn to nuts, Optima plans listed farmland REIT
Reuters | 9 November 2010
Optima's Thomas Gimbel said they are exploring international agricultural investment opportunities, but currently are focusing on U.S. farmland, what he calls the "breadbasket of the globe."
By Carey Gillam
BOSTON, Nov 9 (Reuters) – U.S. investment adviser Optima Fund Management is picking up new U.S. farm properties at a brisk pace as it prepares to take public its farmland real estate investment trust, a top Optima executive said Tuesday.
“There are a lot of institutional investors who are recognizing the opportunity here,” Optima Fund Management Executive Managing Director Tom Gimbel said in a presentation Tuesday to a gathering of agricultural investors. “I think we are at an inflection point.”
Optima, a $4.5 billion private investment firm specializing in hedge funds, started investing in U.S. farmland about two years ago, but it still comprises a small percentage of its portfolio.
Optima intends to list its American Farmland Co REIT in the next three to four years, Gimbel told the Agriculture Outlook Americas conference in Boston. He said Optima has been talking with investment banks and underwriters about the prospects, which appear to be “extremely good.”
Optima is not the first to push for a public farmland REIT. Gladstone Land Corp, a REIT focused on agricultural properties, in August filed plans with U.S. regulators for an initial public offering on Nasdaq under the symbol “LAND.” [ID:nSGE6750KF]
As it prepares for its own offering, Optima’s farmland REIT is diversifying its farmland holdings across the United States, with ownership of 12 different crop varieties, including corn and soybean farms in Illinois, and a vineyard in Monterrey, California.
Optima currently is close to completing the acquisitions of a vegetable farm in Florida, a rice farm in the Mississippi Delta and a walnut grove in California, according to Gimbel.
But the fundamentals for U.S. farmland are strong and growing, Gimbel said.
In a July report, Optima said it saw a long-term, “super cycle” for agriculture continuing for many reasons, including China’s strong demand for U.S. grain, a growing world population that will continue to drive food demand, and a global scarcity for land and water for food production.
Gimbel said Optima is exploring international agricultural investment opportunities, but currently is focusing on U.S. farmland, what he called the “breadbasket of the globe.”
U.S. farmland investments are seen generating lower returns than deals many other investors are pursuing in international markets, but are seen as far less risky, he said.
“We’re starting with the U.S.,” he said. (Reporting by Carey Gillam; Editing by Lisa Shumaker and Maureen Bavdek)
Optima's Thomas Gimbel said they are exploring international agricultural investment opportunities, but currently are focusing on U.S. farmland, what he calls the "breadbasket of the globe."
By Carey Gillam
BOSTON, Nov 9 (Reuters) – U.S. investment adviser Optima Fund Management is picking up new U.S. farm properties at a brisk pace as it prepares to take public its farmland real estate investment trust, a top Optima executive said Tuesday.
“There are a lot of institutional investors who are recognizing the opportunity here,” Optima Fund Management Executive Managing Director Tom Gimbel said in a presentation Tuesday to a gathering of agricultural investors. “I think we are at an inflection point.”
Optima, a $4.5 billion private investment firm specializing in hedge funds, started investing in U.S. farmland about two years ago, but it still comprises a small percentage of its portfolio.
Optima intends to list its American Farmland Co REIT in the next three to four years, Gimbel told the Agriculture Outlook Americas conference in Boston. He said Optima has been talking with investment banks and underwriters about the prospects, which appear to be “extremely good.”
Optima is not the first to push for a public farmland REIT. Gladstone Land Corp, a REIT focused on agricultural properties, in August filed plans with U.S. regulators for an initial public offering on Nasdaq under the symbol “LAND.” [ID:nSGE6750KF]
As it prepares for its own offering, Optima’s farmland REIT is diversifying its farmland holdings across the United States, with ownership of 12 different crop varieties, including corn and soybean farms in Illinois, and a vineyard in Monterrey, California.
Optima currently is close to completing the acquisitions of a vegetable farm in Florida, a rice farm in the Mississippi Delta and a walnut grove in California, according to Gimbel.
But the fundamentals for U.S. farmland are strong and growing, Gimbel said.
In a July report, Optima said it saw a long-term, “super cycle” for agriculture continuing for many reasons, including China’s strong demand for U.S. grain, a growing world population that will continue to drive food demand, and a global scarcity for land and water for food production.
Gimbel said Optima is exploring international agricultural investment opportunities, but currently is focusing on U.S. farmland, what he called the “breadbasket of the globe.”
U.S. farmland investments are seen generating lower returns than deals many other investors are pursuing in international markets, but are seen as far less risky, he said.
“We’re starting with the U.S.,” he said. (Reporting by Carey Gillam; Editing by Lisa Shumaker and Maureen Bavdek)
Private equity sees “buckets of money” in water buys
Reuters | 9 November 2010
By Laura MacInnis
GENEVA, Nov 9 (Reuters) – Water scarcity will generate big returns for the irrigation sector once climate change and population growth take their toll on farming, private equity managers said on Tuesday.
Asked at an agriculture investing conference whether it is possible to make money from water, typically a public good rather than a bankable commodity, Judson Hill of NGP Global Adaptation Partners was unequivocal.
“Buckets, buckets of money,” he told the meeting of bankers and investors in Geneva, a leading European hub for commodity trading. “There are many ways to make a very attractive return in the water sector if you know where to go.”
Smart irrigation technology will be at a premium in arid regions and places where higher crop yields are needed to meet rising food demand, Hill said, also citing opportunities from water rights in Australia and parts of the United States.
“Irrigation is a big industry and it is growing. I think it’s going to grow dramatically,” he said, estimating the sector at $3.5 billion today. “In parts of the U.S. we still grow rice in the desert, as crazy as that is. I think that will change.”
Gary Taylor, a partner with AgriCura, a fund focused on U.S. corn, soybean, cotton, rice and wheat farming, said water was fundamental to smart agricultural land investments.
“We have done extensive work to understand the aquifer system along the Mississippi river and do believe over the term of our fund that water will become increasingly important,” Taylor, a former executive at Cargill, said.
For agricultural equipment manufacturers such as John Deere (DE.N), there are also opportunities in tailoring irrigation systems to drought-resistant seeds developed by companies such as Monsanto (MON.N), Dupont (DD.N) and Syngenta (SYNN.VX).
“There are very efficient ways to approach irrigation,” said Cory Reed, John Deere’s director of strategic marketing, describing a need to water certain commodity crops with careful volumes on a fixed schedule.
Hill also named links with communities as critical to gaining traction in the “very, very local” water sector, where investments can involve negotiations with governments amid growing awareness about scarcity risks.
“The water business is very much like the energy business was 20 or 25 years ago,” he said. “As the price of water increases we are all going to become better stewards, not because we all become environmentalists but because it will affect our pocketbooks.” (Editing by Janet Lawrence)
By Laura MacInnis
GENEVA, Nov 9 (Reuters) – Water scarcity will generate big returns for the irrigation sector once climate change and population growth take their toll on farming, private equity managers said on Tuesday.
Asked at an agriculture investing conference whether it is possible to make money from water, typically a public good rather than a bankable commodity, Judson Hill of NGP Global Adaptation Partners was unequivocal.
“Buckets, buckets of money,” he told the meeting of bankers and investors in Geneva, a leading European hub for commodity trading. “There are many ways to make a very attractive return in the water sector if you know where to go.”
Smart irrigation technology will be at a premium in arid regions and places where higher crop yields are needed to meet rising food demand, Hill said, also citing opportunities from water rights in Australia and parts of the United States.
“Irrigation is a big industry and it is growing. I think it’s going to grow dramatically,” he said, estimating the sector at $3.5 billion today. “In parts of the U.S. we still grow rice in the desert, as crazy as that is. I think that will change.”
Gary Taylor, a partner with AgriCura, a fund focused on U.S. corn, soybean, cotton, rice and wheat farming, said water was fundamental to smart agricultural land investments.
“We have done extensive work to understand the aquifer system along the Mississippi river and do believe over the term of our fund that water will become increasingly important,” Taylor, a former executive at Cargill, said.
For agricultural equipment manufacturers such as John Deere (DE.N), there are also opportunities in tailoring irrigation systems to drought-resistant seeds developed by companies such as Monsanto (MON.N), Dupont (DD.N) and Syngenta (SYNN.VX).
“There are very efficient ways to approach irrigation,” said Cory Reed, John Deere’s director of strategic marketing, describing a need to water certain commodity crops with careful volumes on a fixed schedule.
Hill also named links with communities as critical to gaining traction in the “very, very local” water sector, where investments can involve negotiations with governments amid growing awareness about scarcity risks.
“The water business is very much like the energy business was 20 or 25 years ago,” he said. “As the price of water increases we are all going to become better stewards, not because we all become environmentalists but because it will affect our pocketbooks.” (Editing by Janet Lawrence)
Bankers, funds try to cope with demand for farms
Reuters | 9 November 2010
"There aren't many Goldman Sachs bankers walking around rural China looking for dairy farms," says Rich Gammill, managing director of the Cargill unit Black River Asset Management (Photo: Xinhua).
By Laura MacInnis
GENEVA, Nov 9 (Reuters) – Bankers and fund managers are scrambling to build up rural expertise in response to rocketing investor demand to buy entire farms as an inflation hedge.
Investment funds worldwide have put an estimated $15 billion to $20 billion in agriculture globally, and interest is also growing from ultra-rich investors and pension funds, which see farmland as tangible, strategic assets.
But Rich Gammill, managing director of the Cargill unit Black River Asset Management, which manages $6 billion including in food and agriculture, said farmland investments can be tricky.
“It seems simple, but agriculture is anything but. There is a global supply chain and lots of regulation, a lot of risks and factors that I think the traditional finance people on Wall Street do not have their heads wrapped around,” he said.
Many investors also want international holdings, requiring their advisers to navigate different tax and regulatory systems, as well as rules on foreign land ownership.
“There aren’t many Goldman Sachs bankers walking around rural China looking for dairy farms,” Gammill said.
In the United States, the $1.2 trillion farming sector remains less than 1 percent institutionally owned, mainly because many investors don’t know how to get started, said Mary McNairy, a partner at International Farming Corp, an alternative investment firm.
“It is huge. The question is, how do you get into it, how do you access the market,” she said.
NEED FOR LOCAL CONTACTS
Gary Taylor, a partner with AgriCura, a fund focused on U.S. corn, soybean, cotton, rice and wheat farming, estimated that over the next decade 50 percent of U.S. farmland will change hands, mainly because of the advanced age of most farmers.
Buying agricultural lands requires local links, said Tim Hornibrook, division director of Macquarie Agricultural Funds Management.
“It is essentially a private market. That makes it hard to get access but it also presents great opportunity,” he said.
Several investment managers also described the struggle to bridge the gap “between Wall Street and the farm track”, with a search for farm managers who can deal well with investors and bankers who understand the basics of agricultural operations.
They may also need to learn to cope with farmland issues including jobs and security of food supplies.
Several dozen farmers, union members and activists protested outside the luxury Geneva hotel where the agriculture investing conference was held on Tuesday, saying foreign purchases of farmland risked choking off local food supplies.
“This is the consequence we fear from the liberalisation of agriculture,” said Rudi Berli, a Geneva-based vegetable farmer, who described risks for developing countries in particular. “The small producers are going to suffer from this.”
But Hornibrook of Macquarie said agriculture investors would tread lightly on the terrain they purchased.
“Sustainability is just part of what you do as part of good business practice,” he said. “If you manage your land in the right way, it is going to increase the viability of that land longer term.”
(Editing by Jane Baird)
"There aren't many Goldman Sachs bankers walking around rural China looking for dairy farms," says Rich Gammill, managing director of the Cargill unit Black River Asset Management (Photo: Xinhua).
By Laura MacInnis
GENEVA, Nov 9 (Reuters) – Bankers and fund managers are scrambling to build up rural expertise in response to rocketing investor demand to buy entire farms as an inflation hedge.
Investment funds worldwide have put an estimated $15 billion to $20 billion in agriculture globally, and interest is also growing from ultra-rich investors and pension funds, which see farmland as tangible, strategic assets.
But Rich Gammill, managing director of the Cargill unit Black River Asset Management, which manages $6 billion including in food and agriculture, said farmland investments can be tricky.
“It seems simple, but agriculture is anything but. There is a global supply chain and lots of regulation, a lot of risks and factors that I think the traditional finance people on Wall Street do not have their heads wrapped around,” he said.
Many investors also want international holdings, requiring their advisers to navigate different tax and regulatory systems, as well as rules on foreign land ownership.
“There aren’t many Goldman Sachs bankers walking around rural China looking for dairy farms,” Gammill said.
In the United States, the $1.2 trillion farming sector remains less than 1 percent institutionally owned, mainly because many investors don’t know how to get started, said Mary McNairy, a partner at International Farming Corp, an alternative investment firm.
“It is huge. The question is, how do you get into it, how do you access the market,” she said.
NEED FOR LOCAL CONTACTS
Gary Taylor, a partner with AgriCura, a fund focused on U.S. corn, soybean, cotton, rice and wheat farming, estimated that over the next decade 50 percent of U.S. farmland will change hands, mainly because of the advanced age of most farmers.
Buying agricultural lands requires local links, said Tim Hornibrook, division director of Macquarie Agricultural Funds Management.
“It is essentially a private market. That makes it hard to get access but it also presents great opportunity,” he said.
Several investment managers also described the struggle to bridge the gap “between Wall Street and the farm track”, with a search for farm managers who can deal well with investors and bankers who understand the basics of agricultural operations.
They may also need to learn to cope with farmland issues including jobs and security of food supplies.
Several dozen farmers, union members and activists protested outside the luxury Geneva hotel where the agriculture investing conference was held on Tuesday, saying foreign purchases of farmland risked choking off local food supplies.
“This is the consequence we fear from the liberalisation of agriculture,” said Rudi Berli, a Geneva-based vegetable farmer, who described risks for developing countries in particular. “The small producers are going to suffer from this.”
But Hornibrook of Macquarie said agriculture investors would tread lightly on the terrain they purchased.
“Sustainability is just part of what you do as part of good business practice,” he said. “If you manage your land in the right way, it is going to increase the viability of that land longer term.”
(Editing by Jane Baird)
South America tops farmland investors’ wish-list
Reuters | 10 November 2010
Black River Asset Management, part of the U.S. agri-business giant Cargill, controls 50,000 hectares of productive land in South America and is looking for more chances to strike big farmland and food production deals.
By Laura MacInnis
GENEVA, Nov 9 (Reuters) – Farmers’ fields in Brazil and Argentina are among the most prized assets in a new global market for agricultural land that has sprung up alongside soaring commodity prices.
Private equity and fund managers at a farm investing conference in Geneva named South America a top place to buy, lease and manage agricultural lands for profit.
“The South American marketplace is really booming along right now,” said Mark Zenuk, managing director of the $3 billion NGP Global Adaptation Partners fund.
Black River Asset Management, part of the U.S. agri-business giant Cargill, controls 50,000 hectares of productive land in the region and is looking for more chances to strike big farmland and food production deals.
“It’s a scale approach, for sure,” said Rich Hammill, managing director of Black River, which manages some $6 billion in assets worldwide.
Carlos Aguiar, chief executive of the Macquarie Crop Fund, told the Geneva conference there was an active market in buying and selling Brazilian land.
“There is a scarcity of food and scarcity of land and Brazil is one of the only places that you can expand drastically and have the market that has the technology and the infrastructure in place for that,” he said.
EXPORT TAXES
South America accounts for 59 percent of global exports of oilseeds, 11 percent of grains and 37 percent of meat, said Gonzalo Fernandez Castro of Lumix Capital, who invests in farming in Brazil, Paraguay, Argentina and Paraguay.
With agricultural commodity prices at multi-year highs, buying farmland is seen as a more direct way to cash in on valuable crops and to take advantage of long-term appreciation of farm property.
“For most investors, agriculture is a very, very new asset class,” said Tim Hornibrook of Macquarie Agricultural Funds Management, who said it was typical for people to invest first in domestic farming markets to avoid more complex risks.
For NGP Global Adaptation Partners, Brazil, Paraguay and Uruguay are all attractive destinations and Argentina is under review following the death of former President Nestor Kirchner, a leftist political force who was due to run again in 2011.
“Argentina is extremely interesting,” Zenuk said. “It’s a great breadbasket to the world and it has a good infrastructure system. The problem is they have an export tax regime that they mess around with all the time.”
“You don’t want to be in an asset class where you are not able to market the material on a global basis,” Zenuk continued. “It does provide some difficulty in putting our money there, in a private equity sense.”
But Mark McLornan, the chief executive of Agro Terra, an Argentine farm investment firm which has logged 53 percent net returns in the last four years, said government controls were already factored into his business plans.
“A reduction in export taxes is money straight to my bottom line,” he said. McLornan said Argentina was also appealing as a farm investment destination because of its demographics.
While the average age of farmers in the U.S., European Union and Australia is around 60, in Argentina it is 40, meaning its farm labour force is robust and knowledgeable. “In Argentina it is a sector where people want to work,” he said.
--------------------------------------------------------------------------------
Black River Asset Management, part of the U.S. agri-business giant Cargill, controls 50,000 hectares of productive land in South America and is looking for more chances to strike big farmland and food production deals.
By Laura MacInnis
GENEVA, Nov 9 (Reuters) – Farmers’ fields in Brazil and Argentina are among the most prized assets in a new global market for agricultural land that has sprung up alongside soaring commodity prices.
Private equity and fund managers at a farm investing conference in Geneva named South America a top place to buy, lease and manage agricultural lands for profit.
“The South American marketplace is really booming along right now,” said Mark Zenuk, managing director of the $3 billion NGP Global Adaptation Partners fund.
Black River Asset Management, part of the U.S. agri-business giant Cargill, controls 50,000 hectares of productive land in the region and is looking for more chances to strike big farmland and food production deals.
“It’s a scale approach, for sure,” said Rich Hammill, managing director of Black River, which manages some $6 billion in assets worldwide.
Carlos Aguiar, chief executive of the Macquarie Crop Fund, told the Geneva conference there was an active market in buying and selling Brazilian land.
“There is a scarcity of food and scarcity of land and Brazil is one of the only places that you can expand drastically and have the market that has the technology and the infrastructure in place for that,” he said.
EXPORT TAXES
South America accounts for 59 percent of global exports of oilseeds, 11 percent of grains and 37 percent of meat, said Gonzalo Fernandez Castro of Lumix Capital, who invests in farming in Brazil, Paraguay, Argentina and Paraguay.
With agricultural commodity prices at multi-year highs, buying farmland is seen as a more direct way to cash in on valuable crops and to take advantage of long-term appreciation of farm property.
“For most investors, agriculture is a very, very new asset class,” said Tim Hornibrook of Macquarie Agricultural Funds Management, who said it was typical for people to invest first in domestic farming markets to avoid more complex risks.
For NGP Global Adaptation Partners, Brazil, Paraguay and Uruguay are all attractive destinations and Argentina is under review following the death of former President Nestor Kirchner, a leftist political force who was due to run again in 2011.
“Argentina is extremely interesting,” Zenuk said. “It’s a great breadbasket to the world and it has a good infrastructure system. The problem is they have an export tax regime that they mess around with all the time.”
“You don’t want to be in an asset class where you are not able to market the material on a global basis,” Zenuk continued. “It does provide some difficulty in putting our money there, in a private equity sense.”
But Mark McLornan, the chief executive of Agro Terra, an Argentine farm investment firm which has logged 53 percent net returns in the last four years, said government controls were already factored into his business plans.
“A reduction in export taxes is money straight to my bottom line,” he said. McLornan said Argentina was also appealing as a farm investment destination because of its demographics.
While the average age of farmers in the U.S., European Union and Australia is around 60, in Argentina it is 40, meaning its farm labour force is robust and knowledgeable. “In Argentina it is a sector where people want to work,” he said.
--------------------------------------------------------------------------------
11/07/2010
Le mythe agraire de Isis & Osiris
Le mythe égyptien de Osis et Osiris a une dimension agraire. En effet on peut facilement retracer l'origine agricole de cette fable, dont les principaux personnages prennent place dans le monde naturel. Prenons d'abord le cas d'Osiris. Ce dieu est reconnu par les Egyptiens comme le Grand Constructeur, le Grand Civilisateur, celui qui permet à l'Egypte de passer du monde de la chasse à celui de l'agriculture. En fait, pour l'Egypte antique, l'épi de blé mûri au soleil représente le dieu même, un dieu gorgé de soleil et de pouvoir nourricier.
On présente également Osiris comme un grand conquérant car il a su fléchir par le pouvoir de la douceur tout le monde connu d'alors. Ici encore, il s'agit sans doute d'une métaphore évoquant le succès de la culture du blé auprès des peuples ainsi affranchis des aléas de la chasse. C'est sans doute pourquoi il est dit qu'avec Osiris "le maitre de toutes choses arrivait à la lumière". Le blé que l'on peut engranger, le blé que l'on peut moudre, le blé dont on peut faire du pain dégusté en toute saison, ce blé d'est rapidement imposé aux humains; il a joui des égards qu'on accorde à un roi.
Osiris représente également les crues du Nil, responsables de la croissance du blé. Isis, sa tendre épouse, représente la terre humide, la terre fertile, la terre créatrice, fécondée par le pouvoir générateur des crues d'Osiris. Et Seth repsérente la terre aride du désert avec son vent chaud et desséchant qui dispute sans cesse à Osiris la terre fertile.
Car Seth, le maitre des tempètes et de tous les désordres, ne représente pas uniquement le pouvoir de la sécheresse. Par extension, il devient responsable du sort que le blé va subir au cours de maintes transformations. En effet, on coupe l'épi de blé mûr et, ensuite, on sépare la partie alimentaire de l'écorce en le faisant piétiner par des taureaux. Métaphoriquement, Seth devient donc le bourreau, celui qui abat Osiris, qui le démembre, qui l'enferme et en disperse les morceaux lors des semis.
Esis entre alors en scène, elle accueille les morceaux de son mari port dans le sein de la terre. Grâce au pouvoir de féminin créateur, elle le remembre et lui redonne vie, si bien qu'il reâît pour la prochaine moisson.
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