Why invest in agriculture globally

Over the last 3 years the prices at the global food markets has risen by 50 % on the average (cereals – by 60 %, oil-bearing plants – by over 100 %).

It shows that in the nearest time agricultural production, in particular, crop farming, shall be among the industries with most dynamic price growth.

The price growth shall be caused by:

1. Undersupply

• Lower productivity and smaller cropped areas suitable for high-yield production because of climate changes.
• Supply chain disruptions due to the pandemic, which lead to process breakdowns, that eventually increase risks and costs.
• Labour shortages due to the pandemic, which is particularly true to seasonal workers, that lead to lower gross product.
• Shortages and rise in prices of fertilisers (potash, in particular), machinery and other items necessary for agricultural production, which leads to higher cost or, in the worst case, process breakdowns and lower yields.

2. Growing demand.

• Booming global population fuels demand.
• Facing numerous risks, many governments choose to extend strategic food stocks, which adds up to the demand.

3. Inflation-driven growth that has just started.

• Many central banks have recently practised monetary emission in order to support the nation, which pushed national currencies to weaken.

Furthermore:
Over the last 4 years the global venture investments in foodtech have grown nearly 5 times. More and more investors pay attention to integration of digital technologies into the entire food lifecycle from the farm and production facility to the packaging, storage, cooking and disposal.