More foreign ownership of Australian agribusiness

Vanguard April 2013 p. 9
Duncan B.

More of Australia’s agribusiness has passed into foreign hands with the purchase of Australia’s biggest poultry producer, Ingham Enterprises, by US based global equity firm TPG Capital, in an $880 million deal.

Ingham had annual revenue of $2.2 billion last year and employs more than 8000 staff. The two biggest chicken producers, Inghams and Baiada between them control more than 70% of the Australian chicken market.

TPG was founded in 1992 and has $54.5 billion of capital under management. TPG’s other investments in Australia include energy group Alinta and Healthscope.

Farmer representatives are renewing calls for a register of foreign land ownership in Australia. This comes following the release of a new report that claims that almost 10% of Australia’s prime farm land is foreign owned.

A study conducted last year by leading international environmental scientists from the University of Virginia in the US and the Politecnico di Milan found 4.64 million hectares of prime, high rainfall or irrigated agricultural land in Australia was now in foreign hands.

Foreign countries and corporations are snapping up agricultural land and water rights in many countries around the world. The main countries doing the buying are the UK, (9.3% of all land purchases), and the US (7.8%).

The countries with the highest amount of land acquired include The Democratic Republic of Congo, Indonesia, the Philippines and Sudan. According to real estate agents, there is considerable demand from overseas buyers to buy even more farm land in Australia.

Coal Seam Gas

The struggle against coal seam gas exploration continues. According to figures released recently by activist group Lock the Gate, 408 million hectares, or roughly 53% of Australia, is covered by titles for petroleum exploration and production, plus applications and release areas. This is creating great uncertainty for landholders who do not know if or when their property will be subject to drilling.

Dairy industry still in strife

Dairy farmers are continuing to do it tough, as the Federal Government has ruled out a cash bailout for struggling dairy farmers in Victoria.

Farmer groups including the new Farmer Power group were demanding emergency financial assistance for dairy farmers. There are reports of firms supplying dairy farmers with equipment and other necessities going broke as dairy farmers are having difficulty paying their bills on time. The Farmer Power group is continuing to make its presence felt, with more public meetings to be held in the near future in dairy farming areas.