EMPEA: 62% of LPs plan to increase exposure to EM agribusiness

Some 62 percent of institutional investors are planning to increase their exposure to agribusiness investments in emerging markets, according to data from the Emerging Markets Private Equity Association (EMPEA).

Around half of the limited partners surveyed are looking to build their exposure to agribusiness strategies in each emerging market region, including Asia, central and eastern Europe, Russia, Africa and the Middle East, according to EMPEA’s 2015 Global Limited Partners Survey.

These figures exceed the demand for clean tech, energy/utilities and industrials, and put demand for agri-related investments closer to that for financial assets, according to EMPEA.

Since 2008, 153 private equity firms, including generalist funds, have executed 283 agribusiness transactions in emerging markets totalling $8.9 billion; $2.6 billion of this was invested in 2014 alone.

Fundraising for the sector over the period has been volatile ranging from highs of $1.14 billion in 2010 to just $243 million in 2009, according to EMPEA. Some $1.02 billion was raised in 2014 compared with $1.1 billion in 2013. The $6 billion raised by 40 funds throughout the period puts agribusiness-focused funds at around 2 percent of the total private equity fundraising volumes in emerging markets, according to EMPEA.

Latin American volumes were the biggest for the period although emerging Asia was an increasing popular agribusiness investment destination.

Source: EMPEA’s 2015 Global Limited Partners Survey (click to enlarge)

The results of the survey were released in a new report written by EMPEA alongside Credit Suisse, CDC, WWF and IFC – Private Equity and Emerging Markets Agribusiness: Building value through sustainability.

Look out for more coverage on this important report later.