Alternative Outlook

With many UK growth markets – including central London – experiencing a slowdown this year, it seems farmland is the safe bet for property investment in 2013.

According to research from Savills, the upward trend for annual growth will continue this year, with farmland values predicted to rise by 40 per cent over the next five years. This is in contrast to prime central London property, which will only witness an average of 26 per cent growth over the same period.

Nevertheless, not all farmland will enjoy the same level of performance…

A key driver of foreign investment in land, food security is a challenge mankind has been confronted with in various times and places. Wherever human societies have developed, growing needs have led to increasing arable land. The key solution has always been migration when possible, otherwise innovation-led yield increase. Over millennia, mankind has been gradually spreading over the various continents. This process is now unfolding at the scale of the planet.

Agricultural transactions involving foreign investors recorded since 2000 …

While the global agriculture investment sector experienced continued growth in 2012, allocations of capital to the sector continue to remain below the industry’s needs and potential.

The Food and Agriculture Organization of the United Nations predicts that agriculture production will have to expand 70 percent by 2050 to meet global demand, requiring an annual net investment in developing countries of more than $83 billion.

In addition to growing concerns over food security, which is a fundamental driver for investment in the sec…

English farmland is likely to be in demand in 2013, with prices forecast to rise 5pc over the year, according to estate agent Knight Frank.

Prices rose by almost 3pc in 2012 to £6,214 per acre according to Knight Frank’s Farmland Index, driven by a fall in the supply of good farms for sale, and increased demand from private investors.

“English farmland’s bull-run is not yet over, despite the impact of the horrific weather on farming profitability last year,” said Andrew Shirley, head of rural property research at…

The race to produce a sustainable, scalable form of biofuel has become ‘wacky’ – literally. There are articles printed daily heralding the latest method of producing fuel, be it converting whiskey waste, recycling cooking oil or scooping algae from the ocean. Big Oil is ploughing millions each year into production and research – so why has an answer to our fuel needs not been found yet?

We re-printed an article on our blog recently about how the growth of Ethanol – long seen as a viable fuel alternative – has stalled in Brazil. Br…

The amount of land needed to grow crops worldwide is at a peak, and a geographical area more than twice the size of France will be able to return to its natural state by 2060 as a result of rising yields and slower population growth, a group of experts said on Monday.

Their report, conflicting with United Nations studies that say more cropland will be needed in coming decades to avert hunger and price spikes as the world population rises above 7 billion, said humanity had reached what it called “Peak Farmland”.

More crops for use as…

Following a decade of consecutive annual growth farm land values throughout Great Britain are forecast to continue their upward trend and increase on average by a further 40% over the next five years, according to research released last week (Friday 07 December) by Savills.

This is in stark contrast to the other property success story of prime central London, which after three and a half years of considerable price rises is likely to endure a period of little or no growth next year, but total price growth of 26% by the end of 2017.

‘It …

Farmland continues to rise in value this year with Scottish values outperforming the rest of Great Britain, according to the latest figures from Savills.

The number of acres of farmland marketed in Scotland increased this year by 22 per cent, compared to the first three quarters of 2011 with 36,000 acres advertised publically. This is the largest supply of farmland during the first nine months of the year since 2006.

Luke French of Savills said: “While we have seen a notable increase in supply this year, larger commercially viable f…

Prices for farmland in Brazil surged by an average 14% a year to nearly quadruple over the past decade, well outpacing inflation and nearly matching gains made by São Paulo’s blue-chip Ibovespa stock index, a new study shows.

Improving diets in economies such as China have driven up prices of commodities like soybeans, corn and animal proteins, which in turn have led investment and pension funds to buy Brazilian farmland.

This has steadily pushed up the prices of and investment returns from Brazil’s increasingly productive tropical farml…

Back in the spring Nicholas Barnes wrote about the investment qualities of the UK agricultural sector and its viability as an alternative asset to balance portfolios. At the time there were a number of commentators who were predicting that land values had peaked and that the heat was going out of the market.

Well, seven months on and the sector still looks a pretty good bet, offering investors long term growth prospects, potential tax benefits and low correlation in performance compared to mainstream asset classes. An additional bonus…