A growing global appetite for agricultural assets is revolutionising farming in Australia and spawning new investment models that depart from the traditional family-run farm.
The Australian Financial Review reports that even as the most talked about model for city investors to take a stake in agriculture – through managed investment schemes – is under challenge after high-profile collapses, new alternatives are emerging.
NFF president David Crombie told AFR that “there’s a lot of interest at the moment from funds from Europe, Asia, the Middle East, the United States. They’re all looking at Australian agriculture.”
A partner at business advisory firm PKF, John Kelly, said this interest was motivated by the opportunities for long-term capital growth, the sense that global food security concerns supported a positive future for farming and that Australia was a stable investment environment.
“On the one hand, you’ve got capital circulating around looking to land on a farm. Then on the other hand, you’ve got a farmer who may need some capital to expand, as land has become expensive.”
Mr Kelly said this dynamic was fuelling interest in equity partnerships, which are already common in agriculture in New Zealand.