* Bunge eyes investment fund for South America
* Dow Chemical pension group seeks returns in row crops
By Carey Gillam
NEW YORK, May 7 As economic fears spark riots
in Greece and stock market sell-offs, a range of institutional
and corporate interests said this week they were moving money
into what they see as the relative safety of global farmland.
From company players pushing pension dollars into farmland
to private equity looking for ownership in food production, the
relative safety and upside opportunity tied to food and biofuel
production was a key theme for investment experts who gathered
in New York this week to explore opportunities in agricultural
"It is about safety. Farmland is a great place to store our
wealth," said Charles Allison, managing director of Prudential
Agricultural Investments (PRU.L), which has $3.2 billion in
assets under management.
Among the players moving aggressively into farmland
investment is AMERRA Capital, a one-year-old investment manager
coming to the market this month with a new farmland fund.
AMERRA is backed in part by the Macquarie Group (MQG.AX) global
financial services firm.
"I'm very excited and very keen about the opportunities we
see in the marketplace," said AMERRA principal Craig Tashjian.
Global agribusiness and food company Bunge Ltd (BG.N) is
also setting up an investment fund that will focus on farmland.
Bunge would not provide details but individuals familiar with
the project said the fund would focus on South America, a hot
spot for agricultural investing interest and a key market for
Bunge, which is working to expand its sugar and ethanol-related
An estimated 35 to 40 percent of new investment capital
flowing into the sector now is directed at South America,
principally Brazil, according to Philippe de Laperouse,
managing director for HighQuest Partners, a strategic advisory
and management consulting firm.
The pension fund within Dow Chemical (DOW.N), whose
DowAgroSciences is a global agricultural input provider, is
likewise pushing investments in agriculture.
Ken Van Heel, global director for alternative investments
at Dow, said Dow's pension group recently added farmland as a
real asset investment and was working to expand that rapidly
through farm acquisitions in the United States aimed at annual
returns of 8-12 percent.
Van Heel said Dow particularly likes corn and soybean farms
in the U.S. Midwest.
"We are looking for diversification for the pension fund,
and an inflation hedge," Van Heel said.
Cargill [CARG.UL] subsidiary Black River Asset Management,
which has $6 billion in assets under management, primarily
third-party capital, is growing its private equity business
with a focus on food production and agricultural investments,
particularly in Asia, said Black River managing director Rich
Black River's first food-focused food should close this
summer, Gammill said, and will include investments in dairy
farming in Asia and aquaculture in Central America and South
And at Franklin Templeton Real Estate Advisors, a global
real estate multi-manager that is expanding into real assets
funds, a fresh focus is on identifying and securing
professional farm management.
Joyce Shapiro, managing director real assets for Franklin
Templeton Real Estate Advisors, said she was building a team
focused on real assets, including farm management, as higher
returns can be had from investing with managers directly
operating farm properties.
"There is going to be a very large marriage of
professionalism and capital in the farm space," Shapiro said.
(Reporting by Carey Gillam; Editing by Marguerita Choy)