Food prices are skyrocketing all across the globe, and there’s no end in sight. The United Nations says food inflation is currently at 30% a year, and the fast-eroding value of the dollar is causing food prices to appear even higher (in contrast to a weakening currency). As the dollar drops in value due to runaway money printing at the Federal Reserve, the cost to import foods from other nations looks to double in just the next two years — and possibly every two years thereafter.
That’s probably why investors around the globe are flocking to farmland as the new growth industry. “Investors are pouring into farmland in the U.S. and parts of Europe, Latin America and Africa as global food prices soar,” reports Bloomberg magazine. “A fund controlled by George Soros, the billionaire hedge-fund manager, owns 23.4 percent of South American farmland venture Adecoagro SA.”
Jim Rogers is also quoted in the same story, saying, “I have frequently told people that one of the best investments in the world will be farmland.”
That’s because demand for food is accelerating even as radical climate changes, a loss of fossil water supplies, and the failure of genetically engineered crops is actually reducing food yields around the globe. Ceres Partners, which invests in farmland, has produced astonishing 16 percent annual returns since its launch in 2008. And this is during a depressed economy when most other industries are showing losses.
We have investment opportunities here in Panama for dairy, green house vegetable operations, beef cattle and rice plantations. Please inquire if you have any interest. Also, if you have any interest in investing in South America, I have a friend who is based in Buenos Aires and has a strong commercial, farming and real estate background spanning over 30 years. His firm can handle any type of real property transaction, is well staffed and cover the major market areas in Brazil, Argentina, Uruguay and Chile. He reports that most commodity-exporting countries of South America are facing highly favorable conditions—particularly those with stronger fundamentals, who have easiest access to external financing and stand to benefit the most from low global interest rates. Foreign direct investment in the eleven economies of the region increased almost 20% during 2010 compared to the same period a year ago.
The region’s economy expanded 6% in 2010 and according to ECLAC´s latest report; South America will grow 5.1% in 2011. In terms of countries, the fastest growing this year will be Argentina (8.3%), Peru (7.1%). Uruguay (6.8%), Ecuador (6.4%), Chile (6.3%), Paraguay (5.7%) followed by Colombia (5.3%), Venezuela (4.5%) and Brazil (4%).
For its soils and weather conditions, abundance of natural resources, good infrastructure and the unique possibility of acquiring large extension of productive farmland; South America is indeed worldwide considered a top place to buy, lease and manage agricultural lands for profit. The region accounts for 59% of global exports of oil seeds, 11% of grains and 37% of meat; with Argentina, Brazil, Chile and Uruguay being among the top 10 food exporters.