Why you should invest in agriculture

Why invest in farmland?

The fact that farmland has a long history of delivering strong returns is the key reason why more investors are turning to it as an investment option. There are two types of returns:

  • Increases in the value of farmland.
  • Crop yields or rental payments in cash

Farmland provides investors with several other benefits:

  1. Low volatility: Farmland returns have historically had less volatility than most other asset classes.
  2. Low correlation: Farmland returns typically don’t move in the same direction as the stock market. In many years, farmland has produced a positive return in a year that the S&P 500 has lost value.
  3. Inflationary hedge: Farmland is a real asset that produces commodities like corn and grain. As such, it benefits from inflation since that would boost not only acreage values but also crop income. Because of that, some call farmland a gold-like investment with a yield.

How can I invest in farmland?

However, farmland has been growing as an asset class for investors in recent years as new ways to invest in the sector have emerged. Here’s a look at how an investor can add some farmland to their portfolio. Most Investors of Agro Business are farmers themselves or Retirees. That is why Agroscheme Investment Ltd, brings you PLAN & RETIRE WELL PROMO, which is targeting at the employee and employers in every sector.

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Buy land directly

The most obvious way to invest in farmland is to directly purchase usable cropland or pastureland and rent it out to a farmer or rancher. This method of investing in farming has a sizable upfront cost since an investor would likely need to purchase a large plot of land.

A growing number of ways to invest in farmland

Farmland has historically been a good investment. Unfortunately, not many investors have been able to benefit from this asset class, given the high upfront costs of buying farmland.

However, that has changed in recent years as new opportunities have emerged as AgroScheme Investment Ltd is focused on farming. Because of that, investors can now own a slice of Nigerian farmland for a much smaller upfront cost, which is making it an increasingly accessible asset class.

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