Sprott teams with Ceres to launch US farmland fund

The move bolsters the Canadian metals specialist’s drive to give LPs access to investments with ‘low correlation to the broader market.’

Sprott has joined forces with Ceres Partners, an Indiana-based agriculture asset manager, to launch a fund focused on North American farmland.

The Ceres-Sprott Institutional Farmland Fund will look to acquire and lease US farmland on behalf of institutional investors.

“In addition to renting the farmland to experienced local farmers, the fund will seek to obtain income from both tillable and non-tillable areas wherever possible,” Sprott said.

Sprott executive vice-president Whitney George noted he has been a longstanding Ceres investor.

“The addition of a farmland strategy supports our objective of providing investors access to strategies with low correlation to the broader market,” George added in the statement.

Details about the fund’s structure and target were undisclosed. Sprott declined to comment and Ceres had not returned messages seeking further detail at the time of publication.

Multi-pronged effort

Sprott is a Canadian fund management firm focused on precious metals and real assets. Listed on the Toronto Stock Exchange, the firm currently has C$7.2 billion ($5.7 billion; €4.9 billion) in assets under management with offices in Carlsbad, California and Vancouver.

Ceres is a food and agriculture-focused investment manager with $620 million in total assets that has been investing in farmland since 2007. Its Ceres Farms fund, opened that year, had collected $444.9 million from 546 investors in February, as of its most recent regulatory filing.

The firm’s other vehicle, Ceres Food & Agriculture Opportunity Fund, seeks returns of between 15 percent and 20 percent net of fees through early- and growth-stage investments in North American mid-market food and ag companies. The fund’s investments include the Sugarloaf Crush winemaking facility and Hop Heads Farm, a grower, processor and marketer of high-quality and traditional hops.

Ceres Food & Agriculture Opportunity Fund had raised $7.9 million from 24 investors, which contributed a minimum of $100,000 each, as of a February regulatory filing.