Food and agribusiness survey
Respondents indicate that the market for finance has become rich and varied and thus multiple sources of capital and funding are available to the agribusiness industry, including private equity, bank debt, sovereign wealth funds and the capital markets. This supports the findings of our 2012 survey, which noted a variety of finance sources in use in the agribusiness sector.
Over half of respondents see some improvement in the availability of finance, with 12 per cent saying that the environment has substantially improved. That said, nearly a quarter of respondents (23 per cent) observe a reduced availability of finance.
"Availability has improved generally as the world recovers from the banking crisis."
Ian Hanrahan, Director consumer & agribusiness, ANZ
Respondents also note that while finance is generally available lenders are still quite conservative compared to pre-2008. They point to the fact that non-specialist agribusiness lenders have largely withdrawn from the market, but comment that this may change with improving levels of liquidity.
Respondents take the view that farming and agribusiness is not the most attractive sector for lenders because of the thin margins that exist and because the sector is susceptible to unusually high levels of volatility. Even so, sentiment appears to be improving.
The United States and China are expected by respondents to be by far the biggest investors in the global food and agribusiness sector. Our survey highlights China as the most significant new factor in the industry in the last few years, with the US continuing to be prominent. The Middle East, as a region, is seen as only a peripheral player in the market.
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