Land Commodities was established on the premise that the world is in the early stages of a secular bull market in agricultural commodities. The agricultural investment environment will be characterised by fundamentally constrained supply set against a backdrop of step changes in demand from a rising population and the changing diets of an expanding emerging market middle class.
Layered on top of this will be a completely new and potentially enormous source of demand from energy markets as second and third generation biofuels and new biomass technologies reach maturity and become commercialised (a process which has barely yet begun).
Add to this the fact that a difficult investing climate is driving increasing numbers of investors to look at the asset class for the first time, and it’s reasonable to expect that over the coming decades the demand for (and return from) agricultural assets is likely to exceed any other period in history.
Direct farmland investment offers the most effective route for investors wishing to tap into this potential, with developed farmland markets (as opposed to frontier / emerging markets) being the most compelling investment destination from the perspective of ethics and risk adjusted returns.
Amongst developed farmland markets, Australia tops the list in terms of investment potential. With the lowest land prices per unit of agricultural production and an agricultural sector that is reliably profitable despite lower subsidies than any other Western producer, Australia should be central to any serious agricultural investor’s allocation strategy.
Because we focus almost entirely on this market, Land Commodities’ clients benefit from the exceptional level of specialist expertise we have developed in Australian agricultural investment. Through our local offices in Perth we have undertaken a large volume of transactions and in Western Australia, the country’s most reliable grain producing region, we are now the leading advisory firm by transaction volume, having completed over AU$ 80 million of transactions across 28 commercial scale farms in the first three quarters of 2012 alone.
Since launching in late 2008 we have completed over 150,000 hectares of farmland transactions (to put this in perspective, this is an area of land larger than Greater London, or twice the total land area of Singapore).
From our Swiss and Australian offices we assist our clients at all levels of the investment process from initial research, due diligence and purchase through to tenanting, management and disposal. Our clients include institutional investors (including a Middle Eastern sovereign wealth fund), wealth management divisions of private banks, investment trusts, family offices and private clients.
The diverse background of our team in agriculture, finance and investment brings a depth and thoroughness to our analytical approach that allows us to truly add value for our clients. On the asset side, our clients are able to beat the market by exploiting the very real inefficiencies that exist in the farmland pricing mechanism. On the income side, we ensure that they are able to maximise the amount and reliability of rent and other operating income.
Perhaps as importantly, because of our attention to detail and the integrity and professionalism with which we apply ourselves, our clients have complete peace of mind with respect to this component of their portfolio.
Click here to find out more about the Land Commodities team, or take a look at the Investor section for more information about how farmland can be used to enhance total returns and reduce overall risk and volatility within a diversified investment portfolio.
If you would like to have a preliminary no obligations discussion with us about how an agricultural asset portfolio might be constructed to fulfill your own investment objectives, please feel free contact us. If you would prefer us to contact you, please click here to complete the contact form and we will be happy to have the appropriate member of staff call you to begin discussions on a strictly confidential basis.