Ben Funk Liongate

Ben Funk Liongate - Ag investors eye Africa

The amount of arable land per person is falling. Quality topsoil is diminishing faster than it’s possible to replace it. Good quality soil is being eradicated by development, desertification, urbanisation, and erosion. According to the UN, the rate of soil loss is 10 to 100 times faster than that of replacement.

Demand for farmland will continue to grow for the foreseeable future and is set to exceed any other period in history by a significant margin. Good farmland is becoming scarce and there are plenty of rich countries willing to pay double for it. New innovations in seeds and farming are needed to improve its productivity and increase the yield per acre.

And the focus has shifted to resource seeking rather than market seeking. Investors are focusing on sustainable production of basic foods including animal feed instead of exotic crops. Main activities revolve around land acquisition and the actual food production mentioned at Ben Funk Liongate Statement.

Foreign investors are on the lookout for arable lands that can still be exploited and can prevent the looming food scarcity threat. And much of the potential, and yet untapped opportunity, is perceived to be in Africa. Savvy investors note the following:

 Africa currently holds 60% of the world unused arable land;
 The middle class on the continent is now hovering around 300 million people;
 The World Bank estimates that Africa could more than triple its agriculture output;
 The continent as a whole uses less than 2% of its renewable water resources;

Agriculture dominates most rural economies in Africa. The African Development Bank through its investments in rural infrastructure helped to improve agricultural productivity and competitiveness in the region. Increased productivity in the sector will remain a key growth driving factor.