Australia: Super fund reinforces savings with timber, agriculture
Financial Standard | 11 June 2019
Super fund reinforces savings with timber, agriculture
by HARRISON WORLEY
A $12 billion government superannuation fund moved to reinforce the retirement savings of its members by investing in timber and agriculture.
LGIAsuper will diversify its investment strategy and invest in the agriculture and timber funds of Folium Capital.
The firm - run by former managers of Harvard's endowment funds - invests in assets in diverse locations, including Brazil, Chile, Iberia and Panama.
Folium Capital managing partner Albaro Aguirre said the firm expected to see attractive returns from the funds, even though they are in the early stages.
"In our prior roles, and since Folium's inception, we have been acquiring quality land around the world, upon which we are developing high value irrigated orchards capable of delivering fresh produce to many different markets, with a potential for solid returns," Aguirre said.
"In Chile for example, we are already harvesting and selling small quantities of hazelnuts, walnuts, cherries, blueberries and apples from the orchards that were established at acquisition, but we expect future production and sales to increase significantly once the orchards are fully developed."
The Queensland-based fund said the investment allowed it to tap into the worldwide megatrend of healthy eating.
LGIAsuper head of investment Guy Rundle added the fund's alternative investment strategies had performed well over the past decade, and noted other investments, such as a stake in an American greenhouse vegetable grower.
"The depth of the agriculture sector right now reflects several trends, including consumer interest in healthy food, borrowing food ideas from other cultures, and year-round demand for seasonal produce," Rundle said.
"Over the past 10 years, LGIAsuper's alternative investments, including our agricultural assets, have provided solid investment returns and superior diversification benefits for Queenslanders."
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