CEFC and Canadian pension fund CDPQ buy northern NSW farm

Australian agribusiness is watching the rural property market closely as a wave of green investment focused on low carbon farming approaches.

Australia’s agribusiness sector is watching the rural property market closely as it prepares for a wave of green investment focused on low carbon farming, including a recent $50 million investment by the federal government.

The Australian government’s Clean Energy Finance Corporation joined forces with $400 billion Canadian pension fund, Caisse de dépôt et placement du Québec, to buy 1237ha northern NSW farm The Glen, via a newly created $200 million “sustainable agricultural platform” known as Wilga Farming.

The CEFC has contributed $50 million to the platform, while CDPQ’s contribution is $150 million.

Herron Todd White Victoria and Tasmania agribusiness director John Gunthorpe said there was an increasing number of new sources of capital entering the Australian agriculture market.

“The growing prevalence of impact funds in the agricultural sector is reacting to a new type of investor who, in addition to long term returns, is also starting to look at the ESG credentials of the funds they invest in,” he said.

“The impacts of ESG are yet to be reflected in sales of agricultural assets other than when a registered environmental or carbon project is in place. As the weight of capital increases into this space this may well change in the future however.”

The Glen was listed for sale late last year, with the CEFC and CDPQ’s Wilga Farming partnership recently buying the property for $11.3 million.

Northern NSW farm the Glen was purchased by a fund that is a partnership between the Australian government’s Clean Energy Finance Corporation and Canada’s Caisse de dépôt et placement du Québec.

Blair Burton and Nancy McPherson had owned The Glen since 2003, developing it into a dryland cropping and grazing operation.

Nationals leader David Littleproud said the federal government must priorities local farming families.

“It would be very concerning if Government investment was in any way acting as a barrier to local families entering farm ownership,” Mr Littlepround said.

“It is incumbent on Labor to make sure there are no unintended impacts of all CEFC investments into the agriculture sector and The Nationals will monitor the situation to ensure local farming families don’t miss out.”

The $200 million platform will be managed by Gunn Agri Partners. CDPQ and the CEFC have also acquired a minority stake in Gunn Agri Partners.

Established in 2013 by Bill Gunn, son of late pastoralist Sir William Gunn, Gunn Agri Partners owns more than a million hectares of Australian farmland, predominantly comprising cattle stations and permanent plantings in southern Queensland and northern NSW. Gunn Agri Partners also owns Cunningham Cattle Company.

Minister for Climate Change and Energy Chris Bowen said the government’s investment partnership with the $400 billion Canadian pension fund would focus on “decarbonising” and reducing farm emissions.

“Agriculture is responsible for over 15 per cent of Australia’s greenhouse gas emissions, and by supporting initiatives like this we’re investing in solutions to drive up farm productivity and profits and drive down emissions at the same time,” Minister Bowen said.

CEFC head of natural capital Heechung Sung said the partnership with CDPQ will facilitate “the flow of much-needed capital into the sector”