Andrea Gruza, Vice President, Capital Markets, at Bonnefield Financial Inc., Canada’s largest farmland manager, comments on how investors can help farmers achieve their sustainable goals and how COVID-19 has impacted Ag investing in Canada.


How Can Ag Investors Help Farmers Achieve Their Sustainable Goals?

In my view, there is a natural alignment between progressive, high-quality farming operations and sustainability, as it makes good business sense for farmers to ensure the long-term health and quality of their soils and operations, to drive long-term value. Farmland investing supports farmers by providing them with financing to optimize their operations and to invest in sustainable best practices.

Additionally, with the right management, farmland plays a role as a carbon sink, which can be used to move overall investment portfolios closer to net-zero emission targets.


How Has COVID-19 Impacted Ag Investment Opportunities In Canada?

The Ag industry fared well through COVID-19 relative to other industries, but individual experiences varied, depending on factors such as end markets, supply chains, and the use of seasonal labour.

From an investment perspective, numerous positive conditions are creating a very attractive environment for farmland investments. As a result of COVID-19, Bonnefield saw decreased transaction activity in 2020, which has now resulted in pent-up demand for farmland and related assets. This demand, combined with high commodity prices, a low interest rate environment, and many farmers flush with cash from good harvest conditions across much of Canada, is likely to drive farmland values higher in the near term. Also, as we begin to see the effects of recent monetary policy actions, Bonnefield expects to see farmland act as an inflation hedge in a portfolio.


Read the full article on Institutional Connect’s Private Markets Virtual Forum