"We can't eat semiconductors or auto parts." When Richard Shin of Daewoo Logistics told me this during an interview last week, it hit me hard. Shin is the manager of the Korean firm's $6 billion project to carve a 1.3 million hectare farm out of Madagascar, a formal French colony.
As with timberland, while direct ownership and management (i.e., being a farmer), is a possibility, such a route is similarly fraught with difficulties. One of the most significant of these is the issue of diversification in the farmland itself - especially with a single investment. A well-diversified holding of farmland (row crop, permanent crop, pasture and even timber) will, therefore, not only require a significant investment, but may also involve land holdings in a number of different locations.
“Look at the colour, what a beautiful crop,” says Richard Spinks, pointing to wheat and rapeseed fields that his company sowed this season in western Ukraine. “If all of Ukraine’s farms could produce the yields we are getting, this country could play a big role in feeding the world and establish itself as a geopolitical power,” says the British chief executive of London-listed Landkom.
A British entrepreneur is leasing land from smallholders in an attempt to revive the breadbasket of the former Soviet Union
Landkom has leased 165,000 acres from thousands of landowners in Ukraine and will reap its first big harvest this year.
