Buying of developing countries’ farmland slows

ROME – The pace at which investors in richer countries have been buying farmland in developing nations has slowed with the fall in food prices this year from peaks hit in 2008, United Nations farming experts said on Tuesday.

The surge in food prices fuelled large-scale purchases of farmland by rich countries including Gulf Arab states, a trend that drew criticism for harming the interests of local people.Now the drop in food and agriculture commodities prices, their volatility and the bad publicity the land acquisitions generated is putting off buyers, especially short-term investors, UN food and farm agencies experts said at an international food security forum.’Those who have been targeting food production may be reducing (investments) now,’ Jean-Philippe Audinet, acting director of policy division at the UN International Fund for Agricultural Development (IFAD), told Reuters at the forum.’Maybe some of them don’t want to take this political risk, reputational risk and economic risk,’ Audinet said. Under increasing pressure from critics for limiting land access for local farmers in poor countries, investors have been turning to other ways to ensuring steady supplies, David Hallam, deputy director of trade and markets division at UN Food and Agriculture (FAO) told reporters.Such alternatives to what critics describe as ‘land grabs’ have included setting up joint ventures or reaching long-term supply deals, Hallam said. UN experts said they did not have precise data on the slow down in large-scale investments in foreign land and cited information from private investors and international institutions such as the World Bank.Social and non-government organisations, which held an alternative forum on food security in Rome, said rich country investors had ‘usurped’ over 40 million hectares of fertile land in developing world in less than a year ‘displacing local food production for export interests’.Earlier this year the International Food Policy Research Institute, a Washington-based think-tank, had estimates that since 2006, 15-20 million hectares of land in poor countries had been sold or were under negotiations for sale to foreign buyers.Massive land purchases may gather speed again once food prices start rallying, Audinet said, adding that use of crops for making biofuels had also contributed to farmland buying.UN agencies have started consultations with governments, the private sector, local populations and independent experts to work out global guidelines for land governance. The experts said it would take at least two years to produce a set of non-binding rules. -Nampa-Reuters