Cofco Ltd., China’s largest grains trader, said it is seeking overseas acquisitions to help secure supplies of commodities including soybeans, wheat and sugar as rising domestic incomes spur faster food demand growth.
While foreign investment is nothing new in the Australian sugar industry, the rate at which foreign companies have been pouring money into the industry has caused some concern among canegrowers.
Corporate Chinese interest in Australian rural land assets is gaining momentum and there are several players on the hunt across a wide spectrum of sectors: sugarcane, cotton, wool, tomatoes and grapes for wine.
"The world is running out of farm land quite rapidly and farm land is going to be a very, very precious commodity in time to come. ... Australians are pretty dozy and comfortable on this issue," says Julian Cribb.
Subsidiary of Singapore's Wilmar pays $115m for Australia's largest sugar mill operator and plans to buy back former cane land now used for timber plantations to expand sugar production.
China's Cofco Corporation has acquired an equity stake in Australian sugar producer Tully Sugar and is said to be pursuing a take-over.
Today's emerging new farm owners are private equity fund managers, specialised farmland fund operators, hedge funds, pension funds, big banks and the like.
South Korea's Daewoo Logistics will plant corn in Madagascar, a company official said on Tuesday, with a long-term aim to replace more than half the corn it currently imports from mostly the United States.
Japan's big trading houses, which have enjoyed bumper years from betting on iron ore and metals, are getting into the food market, aiming to tap voracious demand in China and emerging economies.
