Investment in Brazilian farms for sale sees US group cash in
Date added: 31st January, 2011 at 14:00
(view all articles from January, 2011)
Categories: Economy, Natural Resources, Property News
Investment in Brazilian farms for sale saw Illinois-based farmer Phil Corzine and his friends make profits.
The investor spoke to Reuters about the purchases he made in land to grow soybeans 13 years ago.
Teaming up with a partner from Brazil, Mr Corzine and his associates started up a company - South American Soy - which was originally based on a 2,500 acre plot in the state of Tocantins.
"The real opportunity is finding land at lower cost and building a soybean farm down there at much lower cost than you could do it in here in the States," he told the news provider, having bought the plot needed for South American Soy at two per cent the value it would have fetched in Illinois.
Nowadays, Brazil is "one of the hottest investment destinations in the world", Reuters reported.
Indeed, Mr Corzine has seen his firm double the amount of land it owns and become profitable.
While they bought the land at a price of $100 (£63) an acre, its value has grown by 140 per cent in just under seven years.
Meanwhile, they may have profited from some of the $14 billion of investment in global agriculture last year, according to recent estimates by the Organization for Economic Cooperation and Development (OECD), as they manage plots for other funds.
There was $26 billion of foreign direct investment in Brazil last year and one expert believes that the country will continue to be open to investors.
Although the regulations around overseas speculators buying farms for sale in Brazil were recently tightened, Latin America analyst at research firm Eurasia Group Erasto Alaimeda told the information source: "One of the big lessons that the Brazilian left ... have learned (is) that responsible macroeconomic policies, but also foreign investment, are a precondition for higher rates of growth and that they can benefit a lot politically from that."
The appreciation of the value of Brazilian farms for sale can be partly accounted for by an increase in demand.
Reuters explained food prices jumped in 2007 and 2008 and have experienced inflation in the past 12 months.
The OECD has predicted investment in agriculture around the world could increase three-fold in the next five years.
John Paul Thwaytes recently explained to the Financial Times that the industry could be a good investment, as the value of plots is not correlated to equities and speculators benefit from rises in the price of land.
For anyone wishing to invest in the full potential of Brazil, Property Bond Brazil has an excellent array of Brazilian farms for sale. 
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