TIAA-CREF

From the World Bank to pension funds, efforts are under way to regulate land grabs through the creation of codes and standards. Rather than help financial and corporate elites to "responsibly invest" in farmland, we need them to stop and divest.

At an agriculture investment summit in London on Wednesday, leading U.S. and European pensions funds said few assets remained immune from whipsawing markets, prompting institutions to look at farmland.

The agricultural arm of the $US487 billion Teachers Insurance and Annuity Association has snapped up six farming properties from listed company PrimeAg Australia in a deal worth $36.7 million.

A pension fund(!) has seeded(!) a new company (i.e., not a fund!) that will invest its own assets as well as those of peers(!) in actual farms(!) in the developed and developing world!

The Financial Times reported this week that TIAA-CREF is developing a new “investment vehicle” that will bet the retirement funds of millions of American on the rising price of farmland around the world.

Sweden's SEK216bn (€24bn) buffer fund AP2 and TIAA-CREF have increased commitments to an agricultural property company launched last year to $2bn (€1.6bn), attracting interest from several Canadian investors.

Financial services group TIAA-CREF said it is partnering with Canadian and European money managers to form a $2 billion global farmland investing company to capitalize on the growing demand for grains and other agricultural products.

La Caisse de dépôt et placement du Québec se lance à son tour dans la déferlante d’investissements des fonds de retraite dans les terres agricoles.

While agricultural land has the potential to provide a source of long term fixed income, the hurdles are enormous. Extreme illiquidity and sensitivity to geo-political risk mean that diversification of holdings and careful selection are key.

Jose Minaya of TIAA-CREF talks about growing investor interest in farmland and the role of farmland in the pension fund's investment strategy.

Canada could soon get its first exchange-traded farmland management stock.

"The institutional investors are just starting to get into farmland," says Perry Vieth, president of Ceres Partners LLC