China Invests in Australian Agriculture

China Invests in Australian Agriculture-rural-australia-3a

China became the largest investor in Australia’s agricultural sector during the financial year ended June 2014, according to a report from the country’s Foreign Investment Review Board, pouring in 632 million Australian dollars ($450 million), almost twice as much as the year before.

Chinese investment in Australian mining projects fell by a third to A$5.85 billion during the same period, the latest figures available.

Australia’s Seafarms Group is seeking offshore investors to help develop a A$1.45 billion prawn farm in the country’s remote northwest. Nearby, Chinese company Shanghai Zhongfu last year spent A$700 million to launch a sugar and sorghum farm. Integrated Food and Energy Development, a private Australian company, is pitching a project to offshore investors that would convert five cattle stations in Queensland state into a A$2 billion enterprise producing sugar, guar beans and cattle.

China’s push into Australian agriculture has been more cautious than its rush into mining, in which companies spent big on projects at high prices only to lose out as metals prices fell and costs soared. The agriculture investors are mostly limiting their ambitions to joint ventures and stakes in exchange for a share of output. They’re tapping local expertise and retaining existing managers, rather than trying to gain full ownership of farms or launch major greenfield projects, local deal makers say.

Friday April 3rd 2020Hugh