Global commodity boom driving farmland bids
In a world where global investors are all looking for safe havens for their money, they see New Zealand farmland as good buying...Bloomberg reports that international investors, including billionaire George Soros and the Harvard University Endowment Fund are investing heavily in farmland in the US, parts of Europe, Latin America, Africa, and Australia. There has been offshore interest in New Zealand farms, including vineyards, kiwifruit and avocado orchards...Remarkably - and this would have sparked Fay's interest - New Zealand farmland prices have been falling in spite of record export dairy and other commodity prices. While these have cooled lately, few economists are expecting prices to plummet. Rabobank, in a report to a Washington conference a few days ago, predicted agricultural prices would shift higher and become more volatile, saying that any rolling back of biofuels legislation could add to the stresses. It said this would pose increasing problems for governments with their populations forced to cope with higher prices. Official figures, due to be announced soon will show the global population has soared to 9 billion, and climate change could add to food production problems in many countries.