World land grab 'well-advanced as supply runs short'
The Australian | 11 October 2012
by Sue Neales, Rural Reporter
The race to buy arable farm land before its global supply is exhausted is well advanced, a major agricultural conference in Canberra was told yesterday.
Derek Byerlee, co-author of a recent World Bank report The Rising Global Interest in Farmland, said it was clear the world was running out of productive land. He said with the world population set to increase to at least nine billion by 2050, and land being lost daily to urbanisation and degradation, foreign investor and corporate land sales -- commonly called the world land grab were on the rise across the globe.
Dr Byerlee said the only productive land that could be irrigated still was in countries such as Brazil, sub-Saharan Africa, the Ukraine, parts of Russia and Australia.
He said Australia had recently been identified as a top investment opportunity for foreign interests looking to buy undeveloped farm land, because it was politically stable, had a good land tenure system and was close to growing Asian, particularly Chinese, markets.
But in the midst of a fierce debate about the recent sale of Australia's largest irrigated cotton farm to Chinese interests, Dr Byerlee urged Australia not to succumb to fear-driven pressure to put restrictions on foreign investment. "Australia has a reputation worldwide for practising what it preaches and supporting free trade," he told senators at a Parliament House breakfast yesterday. "To me, free trade also means free investment."
Dr Byerlee believes there remains an urgent need for the Australian government to introduce a register of all farm land owned by foreign entities, companies and governments, regardless of size or value.
He said this would remove the community angst about foreign land ownership, much of it fed from erroneous rumours, while also providing a clearer picture of how much Australian farmland was being snapped up by foreign interests.
"Transparency is what it is all about," Dr Byerlee said.
Food prices are expected to continue to rise sharply in the next 30 years, as increasing numbers of middle-class and affluent Chinese and Indians demand more and different food choices and the global population balloons, making agriculture a boom and highly attractive industry to investors and global pension funds.
The Australian government and the National Farmers Federation have both, in principle, backed a national registry being established for foreign farm buyers, but no action has yet been taken.
New Zealand has strict laws in place requiring any foreign interest intending to buy more than 5ha of farmland to report it to the government.
Currently in Australia, no land purchase by foreign companies has to be reported, unless the rural property costs more than $244 million, or the buyer is a sovereign (government) associated company.
Jonathon Foley, from the University of Minnesota, said competition for farm land would only get fiercer as resources needed to grow food became scarcer.
Professor Foley said 40 per cent of the world's land mass and 70 per cent of its available water were currently used for agriculture, while it contributed 35 per cent of harmful greenhouse gas emissions.
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