United States, Canada and China the biggest investors in Australian agriculture in 2020-21

The Foreign Investment Review Board have released their 2020-21 annual report, detailing which countries spend the most on our agricultural assets.

The United States and Canada have continued their love affair with Australian agriculture, topping the table as the nation’s largest foreign investors in the 2020-21 financial year.

The eye-watering dollars North American, European and South East Asian investors have paid for Australian agriculture assets has been revealed in the Foreign Investment Review Board’s 2020-21 annual report.

The United States sits at the top of the list with $874.7m of investment into the agriculture, fishing and forestry industry.

This stunning figure accounts for 14.6 per cent of the $5.8b of foreign investment into agriculture during the 2020-21 financial year.

Canada ranked second with $818.5m of investment, while China was third after investing $645.5m.

Investors from the UK ($518.8m), the Netherlands ($292.2m), Singapore ($186m) and South Korea ($177.7m) were among the other top spenders.

During 2020-21, foreign investment decreased from $7.3b in 2019-2020 to the $5.8b recorded, however approvals increased from 174 to 190.

The $5.8b of agriculture, fishing and forestry industry investment accounts for two per cent of the total $233b of foreign investment in Australia in 2020-21.

FIRB acting board chair Cheryl Edwards said that changes in foreign investment trends were caused by Covid-related economic instability.

The sale of Riverina grain property Yarrabee Park was subject to FIRB approval as Canadian fund PSP Investments purchased the farm. Picture: Supplied.

“As Covid continued to cause economic uncertainty and impact investor confidence, foreign direct investment inflows declined across countries comparable with Australia,” she said.

“The reporting period saw a decline in the number of proposals, however, the total value of approved investments increased from $195.5 billion in 2019-20 to $233.0 billion in 2020-21.”

Australia has one of the highest foreign investment rates in the developed world at an average of 2.9 per cent of GDP in the three years to 2020.

Whereas, in that same time the OECD and G20 economies average a 1.2 per cent and 1.3 per cent foreign investment rate of GDP.

This reporting period was also affected by the Federal Government’s decision to transition out of the temporary zero dollar threshold.

From March 29 to December 31 2020, all foreign investments, regardless of value, were screened due to international market uncertainty.

However as of January 1, 2021, the existing thresholds of $15m for foreign buyers of agricultural land and $55m for investment in agribusiness returned.

Earlier this year the grain powerhouse, Yarrabee Park, was sold by goFARM to Canada’s PSP Investments via Daybreak Cropping, with the $60m-plus deal subject to FIRB approval.