Farmland investments may return an average of 8 percent to 12 percent annually as global food demand increases, said the largest U.S. pension manager for teachers and academic researchers with $469 billion of assets. The pension manager buys land and leases it back to farmers, The company has $2.5 billion invested in farmland and owns about 600,000 hectares (1.48 million acres) mostly in the U.S., Brazil and Australia. Returns in the past few years have been at the high end of the 8 percent to 12 percent range.
Farmland values in one of the most-productive regions in the U.S. Midwest soared 17 percent in the second quarter as higher grain prices made real estate more attractive
Shrinking land and water supply in countries including China and India, will limit their capacity to boost food production, creating import demand. That’s going to be met by the major exporting regions in North and South America, Australia, and parts of Central and Eastern Europe.
http://www.businessweek.com/news/2011-10-06/farmland-seen-returning-up-to-12-by-u-s-pensions-manager.html
Showing posts with label land grab. Show all posts
Showing posts with label land grab. Show all posts
Friday, October 07, 2011
Tuesday, May 03, 2011
LAND GRABBING 2
Further to an earlier blog we read:-
Large-scale land acquisitions for agricultural use by both local and foreign commercial entities – often dubbed “land grabs”- are on the rise worldwide. The rush to acquire land is driven by four factors: food price volatility and unreliable markets; the energy crisis and interest in agro-energy/biofuels; the global financial crisis; and a new market for carbon trading. Often touted as a form of economic development, these investments could have profound negative effects on the environment and rural livelihoods. While precise details are hard to come by, it is clear that at least 50 million hectares of good agricultural land – enough to feed 50 million families in India – have been transferred from farmers to corporations in the last few years alone, and each day more investors join the rush. Some of these deals are presented as a novel way to meet food security needs of countries dependent on external markets to feed themselves, such as Qatar, Saudi Arabia, South Korea or China. Others are bluntly exposed for what they really are: business deals and hot new profit opportunities. Despite the involvement of states, most of these transactions are between host governments and private corporations. Firms involved estimate that US$25 billion have already been committed globally, and boast that this figure will triple in a very near future. Land grabs, which target 20% profit rates for investors, are all about financial speculation. This is why land grabbing is completely incompatible with ensuring food security: food production can only bring profits of 3-5%. Land grabbing simply enhances the commodification of agriculture whose sole purpose is the over-remuneration of speculative capital. These agribusiness projects – from the 100,000 hectare Malibya deal in the Office du Niger, Mali, to the 320,000 hectare Beidahuang Group deal in Rio Negro, Argentina – do great harm and are profoundly illegitimate. Trying to compensate for this absence of legitimacy by getting investors to adhere to a few principles is deceitful. Land grabs, either through economic or physical means, are, as Teo Ballvé from University of California, Berkeley put it, actually the "last step in a long chain of violent events" perpetrated against small farmers and pastoralists. The commodification and privatisation of land and the dispossession of farmers and herders is seldom taken into account in the boardrooms of corporations or in high-level meetings with governments.
The violation of international human rights law is an intrinsic part ofland grabbing through forced evictions, the silencing (and worse) of critics, the introduction of non-sustainable models of land use and agriculture that destroy natural environments and deplete natural resources, the blatant denial of information, and the prevention of meaningful local participation in political decisions that affect people's lives. No set of voluntary principles will remedy these facts and realities. However, even if done "transparently," the transfer of large tracts of land, forests, coastal areas and water sources to investors is still going todeprive smallholder farmers, pastoralists, fisherfolk and other local communities from crucial, life sustaining resources for generations to come. In many countries, there is an urgent need to strengthen systems that protect land tenure of peasants and small-scale food producers, and many social movements have been fighting for recognition of their rights to land for many years. In many developing countries, however, local peoples’ rights to land are not recognized or enforced by governments. Often times, governments make decisions about how land and natural resources will be used withoutconsulting the people who depend on those resources for their livelihoods. People who rely on customary or traditional rights are particularly vulnerable to losing their land because there is little or no official documentation of their rights to protect them from their land being taken by someone else. This is a serious problem in Africa, where formal tenure covers only some 2 – 10% of all land.
In Ethiopia official government data in five of its nine regions indicate that a total area of at least 1.2 million ha – roughly 8.6% of the country’s cultivated area – were transferred to domestic and foreign commercial entities between 2005 and2010. Although production data are scarce, media reportsindicate that land acquired by Saudi Arabian companies in Ethiopia willbe used to produce vegetables, flowers, and rice for export to nations in the Middle East. Meanwhile, Ethiopia is due to receive food aid for 5.7 million people in 2011 from the United Nations World Food Programme. The size of individual deals can be staggering – in the Democratic Republic of Congo (DRC), aChinese company has reportedly acquired rights from the central government to some 3 million ha of forest land across three provinceswhere indigenous people and other communities still rely on forests fortheir livelihood and culture. This transaction represents roughly two-thirds of the entire area in DRC that is potentially suitable for growing oil palm but not yet cultivated.
A broad consensus has grown over the past several years around the real solutions to hunger, the food crisis and climate chaos, namely that:
- peasant agriculture, family farming, artisanal fishing and indigenous food procurement systems that are based on ecological methods is the way forward toward sustainable, healthy and livelihood-enhancing food systems;
- production, distribution and consumption systems must radically change to fit the carrying capacity of the earth;
- new agricultural policies that respond to the needs, proposals and direct control of small-scale food producers have to replace the current top-down, corporate-led, neoliberal regimes; and genuine agrarian and aquatic reform programmes have to be carried through to return land and ecosystems to local communities.
This is the path to food sovereignty and justice, quite the oppositeof "responsible" land grabbing.
FROM HERE
Large-scale land acquisitions for agricultural use by both local and foreign commercial entities – often dubbed “land grabs”- are on the rise worldwide. The rush to acquire land is driven by four factors: food price volatility and unreliable markets; the energy crisis and interest in agro-energy/biofuels; the global financial crisis; and a new market for carbon trading. Often touted as a form of economic development, these investments could have profound negative effects on the environment and rural livelihoods. While precise details are hard to come by, it is clear that at least 50 million hectares of good agricultural land – enough to feed 50 million families in India – have been transferred from farmers to corporations in the last few years alone, and each day more investors join the rush. Some of these deals are presented as a novel way to meet food security needs of countries dependent on external markets to feed themselves, such as Qatar, Saudi Arabia, South Korea or China. Others are bluntly exposed for what they really are: business deals and hot new profit opportunities. Despite the involvement of states, most of these transactions are between host governments and private corporations. Firms involved estimate that US$25 billion have already been committed globally, and boast that this figure will triple in a very near future. Land grabs, which target 20% profit rates for investors, are all about financial speculation. This is why land grabbing is completely incompatible with ensuring food security: food production can only bring profits of 3-5%. Land grabbing simply enhances the commodification of agriculture whose sole purpose is the over-remuneration of speculative capital. These agribusiness projects – from the 100,000 hectare Malibya deal in the Office du Niger, Mali, to the 320,000 hectare Beidahuang Group deal in Rio Negro, Argentina – do great harm and are profoundly illegitimate. Trying to compensate for this absence of legitimacy by getting investors to adhere to a few principles is deceitful. Land grabs, either through economic or physical means, are, as Teo Ballvé from University of California, Berkeley put it, actually the "last step in a long chain of violent events" perpetrated against small farmers and pastoralists. The commodification and privatisation of land and the dispossession of farmers and herders is seldom taken into account in the boardrooms of corporations or in high-level meetings with governments.
The violation of international human rights law is an intrinsic part ofland grabbing through forced evictions, the silencing (and worse) of critics, the introduction of non-sustainable models of land use and agriculture that destroy natural environments and deplete natural resources, the blatant denial of information, and the prevention of meaningful local participation in political decisions that affect people's lives. No set of voluntary principles will remedy these facts and realities. However, even if done "transparently," the transfer of large tracts of land, forests, coastal areas and water sources to investors is still going todeprive smallholder farmers, pastoralists, fisherfolk and other local communities from crucial, life sustaining resources for generations to come. In many countries, there is an urgent need to strengthen systems that protect land tenure of peasants and small-scale food producers, and many social movements have been fighting for recognition of their rights to land for many years. In many developing countries, however, local peoples’ rights to land are not recognized or enforced by governments. Often times, governments make decisions about how land and natural resources will be used withoutconsulting the people who depend on those resources for their livelihoods. People who rely on customary or traditional rights are particularly vulnerable to losing their land because there is little or no official documentation of their rights to protect them from their land being taken by someone else. This is a serious problem in Africa, where formal tenure covers only some 2 – 10% of all land.
In Ethiopia official government data in five of its nine regions indicate that a total area of at least 1.2 million ha – roughly 8.6% of the country’s cultivated area – were transferred to domestic and foreign commercial entities between 2005 and2010. Although production data are scarce, media reportsindicate that land acquired by Saudi Arabian companies in Ethiopia willbe used to produce vegetables, flowers, and rice for export to nations in the Middle East. Meanwhile, Ethiopia is due to receive food aid for 5.7 million people in 2011 from the United Nations World Food Programme. The size of individual deals can be staggering – in the Democratic Republic of Congo (DRC), aChinese company has reportedly acquired rights from the central government to some 3 million ha of forest land across three provinceswhere indigenous people and other communities still rely on forests fortheir livelihood and culture. This transaction represents roughly two-thirds of the entire area in DRC that is potentially suitable for growing oil palm but not yet cultivated.
A broad consensus has grown over the past several years around the real solutions to hunger, the food crisis and climate chaos, namely that:
- peasant agriculture, family farming, artisanal fishing and indigenous food procurement systems that are based on ecological methods is the way forward toward sustainable, healthy and livelihood-enhancing food systems;
- production, distribution and consumption systems must radically change to fit the carrying capacity of the earth;
- new agricultural policies that respond to the needs, proposals and direct control of small-scale food producers have to replace the current top-down, corporate-led, neoliberal regimes; and genuine agrarian and aquatic reform programmes have to be carried through to return land and ecosystems to local communities.
This is the path to food sovereignty and justice, quite the oppositeof "responsible" land grabbing.
FROM HERE
Sunday, April 24, 2011
land grabbing
“Nothing will bring a government down faster than hungry people,” says Robert Thompson, former director of rural development at the World Bank.“If a country can’t supply its food domestically, it wants assurances that supplies will be there through thick and thin and that exporting countries will allow trade to flow,” he says.
India’s government is considering buying or leasing millions of acres of land in Central and South America. The purpose: to grow crops that will help feed India’s 1.1 billion people. North of Buenos Aires, Argentina, a Japanese company is growing corn and soybeans for shipment back to Japan. In Africa, a Japanese aid agency works with partners from Brazil and Mozambique to convert part of Guinea’s vast savannah into corn, soybean and cotton production. A leading Malaysian palm-oil producer is looking at plans for a 300,000-hectare (720,000-acre) palm-oil plantation in Cameroon. Bahrain currently produces bananas on 2,400 acres in the Philippines. Kuwait is interested in another 2,400 acres there for rice production. Saudi investors are negotiating for an additional 2,400 acres for aquaculture and are already pumping money into a 12,000-acre project to grow basmati rice, corn, bananas and pineapple. In Mongolia, South Korea has bought more than 800,000 acres to develop “an overseas food base” to procure more food resources. In Romania, nearly 2.4 million acres of farmland are now foreign-owned – about 12% of the country’s base farmland. Most examples involve richer countries with large populations and limited agricultural resources attempting to improve their food security by controlling land and agricultural production in poorer, less developed nations. The growing trend is fueling concerns that the purchases are another form of colonialism.
China is looking to buy 200,000 hectares of farmland in Russia, Australia, Argentina and other countries, the Des Moines Tribune reported in March. In Venezuela and Zimbabwe, they provide machinery and laborers in return for 20% of the harvest. In Australia they buy local land and in Brazil and Argentina they tend to rent. They also rent in Russia and Mongolia. China has already invested $85 million since 2005, the Register adds. “In Venezuela and Zimbabwe, they provide machinery and laborers in return for 20% of the harvest. In Australia they buy local land and in Brazil and Argentina they tend to rent. They also rent in Russia and Mongolia,” the Des Moines Register reported.
Demand for good agricultural land has exploded around the globe. Before 2008, global farmland expanded on average by fewer than 10 million acres annually, but expansion plans in 2009 totaled more than 100 million acres, according to the World Bank. More than 70% of the demand has been in Africa, where Ethiopia, Mozambique, Sudan and other countries have transferred millions of acres to investors. In the food prices crisis of 2008 a number of exporting countries went to either taxing or banning exports, and many food importers like China began to get nervous about food availability. With the erosion of confidence in the ability of world markets to assure supplies, they are thinking that if they own the farms, they have a better chance of getting the food out.
Jay O’Neil, senior agricultural economist at Kansas State’s international grains program, argues that big investments in foreign farmland don’t do much to solve nations’ food security fears. “In countries like China, the leaders get up each morning and ask ‘How are we going to guarantee food security for the coming years?’” says O’Neil. “They don’t realize that buying land doesn’t solve the question. It has zero effect on domestic price inflation, and it doesn’t guarantee that the grain will go to whoever owns the land. It doesn’t mean governments wouldn’t slap on export controls as Russia did in 2010. Probably when they most need grain is when they would be at the most risk of restrictions,”
Taken from here
India’s government is considering buying or leasing millions of acres of land in Central and South America. The purpose: to grow crops that will help feed India’s 1.1 billion people. North of Buenos Aires, Argentina, a Japanese company is growing corn and soybeans for shipment back to Japan. In Africa, a Japanese aid agency works with partners from Brazil and Mozambique to convert part of Guinea’s vast savannah into corn, soybean and cotton production. A leading Malaysian palm-oil producer is looking at plans for a 300,000-hectare (720,000-acre) palm-oil plantation in Cameroon. Bahrain currently produces bananas on 2,400 acres in the Philippines. Kuwait is interested in another 2,400 acres there for rice production. Saudi investors are negotiating for an additional 2,400 acres for aquaculture and are already pumping money into a 12,000-acre project to grow basmati rice, corn, bananas and pineapple. In Mongolia, South Korea has bought more than 800,000 acres to develop “an overseas food base” to procure more food resources. In Romania, nearly 2.4 million acres of farmland are now foreign-owned – about 12% of the country’s base farmland. Most examples involve richer countries with large populations and limited agricultural resources attempting to improve their food security by controlling land and agricultural production in poorer, less developed nations. The growing trend is fueling concerns that the purchases are another form of colonialism.
China is looking to buy 200,000 hectares of farmland in Russia, Australia, Argentina and other countries, the Des Moines Tribune reported in March. In Venezuela and Zimbabwe, they provide machinery and laborers in return for 20% of the harvest. In Australia they buy local land and in Brazil and Argentina they tend to rent. They also rent in Russia and Mongolia. China has already invested $85 million since 2005, the Register adds. “In Venezuela and Zimbabwe, they provide machinery and laborers in return for 20% of the harvest. In Australia they buy local land and in Brazil and Argentina they tend to rent. They also rent in Russia and Mongolia,” the Des Moines Register reported.
Demand for good agricultural land has exploded around the globe. Before 2008, global farmland expanded on average by fewer than 10 million acres annually, but expansion plans in 2009 totaled more than 100 million acres, according to the World Bank. More than 70% of the demand has been in Africa, where Ethiopia, Mozambique, Sudan and other countries have transferred millions of acres to investors. In the food prices crisis of 2008 a number of exporting countries went to either taxing or banning exports, and many food importers like China began to get nervous about food availability. With the erosion of confidence in the ability of world markets to assure supplies, they are thinking that if they own the farms, they have a better chance of getting the food out.
Jay O’Neil, senior agricultural economist at Kansas State’s international grains program, argues that big investments in foreign farmland don’t do much to solve nations’ food security fears. “In countries like China, the leaders get up each morning and ask ‘How are we going to guarantee food security for the coming years?’” says O’Neil. “They don’t realize that buying land doesn’t solve the question. It has zero effect on domestic price inflation, and it doesn’t guarantee that the grain will go to whoever owns the land. It doesn’t mean governments wouldn’t slap on export controls as Russia did in 2010. Probably when they most need grain is when they would be at the most risk of restrictions,”
Taken from here
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