MACQUARIE Group's $700 million international crop fund has been dealt a serious blow with new foreign investment restrictions on rural property in Brazil stalling its expansion.
The curbs have made it more difficult for Macquarie to buy cropping property in Brazil and stalled several potential acquisitions in NSW, The Australian Financial Review reports.
The fund's mandate was to buy 70 per cent of its properties in Brazil and 30 per cent in Australia, but the Australian properties could only be purchased if the Brazilian properties were, and vica versa.
Macquarie had been looking to buy several cropping aggregations near Henty in southern NSW and in the state's central west but interest has waned because of the restrictions in Brazil.
Farmland in Brazil now carries with it the same importance as oil. That government has resurrected a law from 1971 which restricts the amount of land a foreign investor can buy. The details are under review and could include a national interest test for those wishing to purchase.