A number of financial institutions, following on from the commodities boom of 2008 and the threat of inflation in the future, have targetted the industry to help investors achieve secured asset backed returns and deliverability not seen in many, if any, asset classes today.
Unfortunately, however, traditional routes of funding, ie banks, have almost completely dried up. This dilema happens at a time when demand is at all time highs. The number of enquiries from farmers looking to buy neighbouring land, refurbish assets or upgrade due to new EU legislation, is increasing by the day, with UK Farm Finance getting upwards of 20 enquiries a week.
Chris Davidson, Head of UK Farm Finance's investment arm, said “lenders like ourselves are having to be extremely creative in raising capital to satisfy the demand we currently face. However, the market is beginning to realise that investing in 1st legal charge asset backed debt opportunities in agriculture provides one of the more exciting avenues for returns in the next couple of years.”
Davidson continues to explain that “the options for a number of financial routes are many and varied. Products like ours suit funds looking to hedge against futures positions, for pension schemes looking to claw back monthly income lost on other asset classes, and for wealth management companies looking to deliver for their clients”.
Chris Davidson can be contacted on 01278 772650 or at chris.davidson@
