We are all aware of the ongoing debate in relation to foreign
investment in agricultural land in Australia and that it is a hot
Feelings can run high and a large majority (81 per cent) of
Australians are against the Australian Government allowing foreign
investors to buy Australian farmland to grow crops or farm
livestock, with 63 per cent saying they are strongly
I was recently asked to comment on Dick Smith's rejection of
foreign investment in agriculture, specifically in S. Kidman &
Co Ltd. Mr Smith is one of Australian Agricultural Company's
biggest shareholders. The question I would pose to Mr Smith –
would his approach be different if he was a shareholder in S.
Kidman & Co?
About 95 per cent of the nation's farms are family owned.
Despite adverse conditions that commonly affect regional areas such
as droughts, floods and increasing salinity, these family farms
demonstrate a remarkable degree of resilience. However, the reality
is that the most productive farms are largely commercial,
non-family based farms. The challenge thus facing Australian
agriculture is to turn the family farms into more productive and
commercially viable units.
It is important to put foreign investment in context.
In 2013, foreign investment in Australia totalled around $170
billion of which only 2.2 per cent ($3.6 billion) was associated
with agriculture. The vast majority was mining ($50 billion),
manufacturing ($30 million) and services ($20 billion).
In the five years ending in June 2012, the regulatory authority
in Australia, the Foreign Investment Review Board, approved $12.6
billion worth of investment in agriculture which amounted to only
about 1.5 per cent of the $844.8 billion in approved foreign
investment in all Australian enterprises.
The countries investing in Australian agricultural land over
that period included Canada (25 per cent), United Kingdom (22 per
cent), USA (12 per cent), UAE (5 per cent), New Zealand (4 per
cent) and China (less than 1 per cent).
In recent months, Thynne + Macartney's Agribusiness Group
has been involved in two signature deals in the beef sector
involving foreign investment:
"Wollogorang" situated in the Gulf of Carpentaria in
the north of Australia, an area of over 709,000 hectares (over
2,700 square miles) running approximately 40,000 head of cattle
bought by a Chinese billionaire Mr Xingfa Ma for AUD$47 million. Mr
Ma already owns an extensive portfolio of pastoral properties in
"Walhallow" and "Cresswell Downs" situated
in the Barkly Tablelands in the Northern Territory, an area of over
999,000 hectares (over 3,800 square miles) running approximately
50,000 head of cattle bought by interests associated with Mr Brett
Blundy, one of Australia's richest individuals now living in
Singapore for AUD$100 million. Again, Mr Blundy has extensive
interests in pastoral Australia. The seller of
"Walhallow" and "Cresswell Downs" was Paraway
Pastoral Company Limited, Macquarie Bank's rural trust –
itself a foreign owned investment vehicle.
Both transactions required the consent of the Foreign Investment
Review Board which was obtained without undue delay or
While such acquisitions will continue to be monitored by the
Federal Government (foreign owners, existing and future, are now
required to register their interests) the reality is Australian
broadacre agriculture has been and will continue to be largely
reliant on foreign investment.
Thynne + Macartney's Agribusiness Group (while based in
Brisbane on Australia's east coast) services the entire
northern part of Australia, particularly in relation to the beef
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The High Court of Australia has granted special leave to appeal a decision of the NSWCA that upheld an adjudication determination under the NSW 1999.
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