Happy New Year

During the final throes of 2016, we outlined some key topics that warrant extra attention for private equity investors looking at agriculture in the New Year. 

As we come to grips with returning to work in the New Year, parting with the holiday’s steady flow of home-cooked food, cookies and libations, let’s look at the bright side through the major opportunities private equity investors in agriculture can expect in 2017.

Just days after I took the helm as editor of Agri Investor in late October, I noted at our annual forum in Chicago a consensus that much opportunity exists in the huge funding gap that remains to be filled in agriculture, but that private equity funds may need to break away from traditional fund structures and investment cycles in order to be successful.

Since then I’ve continued to encounter a great deal of excitement about the opportunities for private investors and fund managers closely examining the industry, as well as caution regarding the challenges that come along with this burgeoning asset class. Identifying those opportunities and challenges for our readers has naturally become a main tenet of the mission for our newly-assembled New York City-based editorial team.

Leading into the New Year we created a series of posts touching on some of these themes. Consolidation will continue to shape private equity’s role in agriculture as inevitable personnel shifts occur and offshoot businesses arise; we saw a steady flow of deals in 2016, big and small, which we expect to keep pace this year. Another major theme to look out for is the aging nature of the farming population and the opportunities for private equity to acquire farmland and provide exit strategies, particularly in the US, as we outlined following our forum. 

Water and marijuana are two commodities garnering particular enthusiasm, both of which remain largely untapped by private money, while the timber market hasn’t exactly paid off as much as some investors would have hoped.

In case you missed them, here is the rundown of these various issues. Although not meant to be an exhaustive list, they’re themes we think should garner extra attention in 2017:

Where investments flow

Consolidation to help shape PE’s role

Out of the weeds

Ag and the whims of US-China relations

Timber’s institutionalization