![\"\"](\"https:\/\/familyfarmers.org\/wp-content\/uploads\/2011\/07\/graph-pension2011.png\" "\\"graph-pension2011\\"")
<\/a><\/p>\nSources: Bank for International Settlements (L) and UN Food and Agriculture Organisation (R)<\/p>\n
According to Barclays Capital, some US$320 billion of institutional funds are now invested in commodities, compared to just US$6 billion ten years ago. Hedge funds account for an additional US$60\u2013100 billion. These figures are expected to double in the next few years. 5<\/p>\n
Within this panorama, pension funds are said to be the biggest institutional investors in both commodities in general (US$100 billion of the US$320 billion indicated above) and farmland in particular. 6 According to numerous surveys within the industry, pension fund managers are seeking to invest in farmland \u2013 a new asset class offering annual returns of 10\u201320% \u2013 as never before. 7 This won\u2019t surprise anyone who has been monitoring the big \u201cag investment\u201d seminars being held in posh hotels from Zurich to London to New York to Singapore over the last three years. Take the Global AgInvesting Conference held at the Waldorf Astoria in Manhattan just last month: the conference attracted about 600 investors, from Bunge to Deutsche Bank. Collectively, this group represented holdings of US$10.8 billion in agricultural assets worldwide, with plans to raise those holdings to US$18.1 billion (up 67%) over the next three years. Farmland is at the centre of the acquisition strategy for many of these firms. Nearly one-third (30%) of them were pension funds.<\/p>\n Pension funds may be one of the few classes of land grabbers that people can pull the plug on, by sheer virtue of the fact that it is their money.<\/p>\n Today, commodities like farmland make up, on average, 1\u20133% of pension funds\u2019 portfolios. 8 Yet by 2015, strategy decisions being taken now are expected to boost this to 3\u20135%, the \u201cnew optimal\u201d. 9 While figures of one, three or five per cent may sound terribly small, these are huge funds, where one per cent may amount to several billion dollars. Table 2 tries to go a bit deeper and examine some sample farmland portfolios of pension fund managers. But, as so often, the data are opaque and hard to come by.<\/p>\n Table 2: Examples of pension funds investing in farmland (2010\u20132011) Expected to allocate 3% toUBSAgrivestFarmlandFund Calling them down<\/p>\n The big picture shows that:<\/p>\n 1. the largest institutional investors are planning to double their portfolio holdings in agricultural commodities, including farmland; It may not be easy to influence pension fund managers themselves. After all, they have no objective other than to make money \u2013 including their own cut \u2013 with the funds handed to them. But surely labour unions, employee-benefits planning bodies, pension boards, governments, and others who are responsible for strategy decisions about how pensions should be invested and grown can and should be persuaded to divest from farmland and other agricultural commodities.<\/p>\n One recent experience in the US, recounted by Sarah Anderson of the Institute for Policy Studies, gives a good example:<\/p>\n A coalition of family farm, faith-based and anti-hunger groups, along with business associations, have initiated a campaign to persuade investors to pull out of commodity index funds. Their first target: CALSTRS, the California teachers\u2019 retirement system, which had been considering shifting $2.5 billion of their portfolio into commodities. In response to the divestment campaign, the CALSTRS board decided on November 4 to adopt a different strategy. Instead of $2.5 billion, they will invest no more than $150 million in commodities for 18 months, while further studying the potential problems. 10<\/p>\n Such divestment campaigns \u2013 which could aim at ensuring that pension funds do not buy into agricultural land overseas \u2013 are clearly within reach and could make a difference. And they can add their weight to the broader momentum under way in so many of our countries to rethink two vital matters: food and agricultural policies, which require constructive investment strategies; and retirement systems in general. There is too much at stake not to seize these opportunities<\/p>\n Going further<\/p>\n The website farmlandgrab.org is regularly updated with articles and news about pension funds going into farmland. Seehttp:\/\/farmlandgrab.org\/search?query=pension+fund&sort_order=date for a direct view. It also provides a wealth of contacts and reports of people\u2019s experiences in dealing with the global rush to get control over farmland, in the context of the current food crisis.<\/p>\n Watch a presentation by Jose Minaya of TIAA-CREF at the World Bank\u2019s land conference in April 2011: http:\/\/vimeo.com\/23314644<\/p>\n Endnotes<\/p>\n 1 See the materials from the international conference on Global Land Grabbing held on 6\u20138 April 2011 at the Institute for Development Studies, University of Sussex, UK, http:\/\/www.future-agricultures.org\/index.php?option=com_content&view=category&layout=blog&id=1547&Itemid=978. See also John Vidal\u2019s reports for the Guardian(http:\/\/www.guardian.co.uk\/world\/2011\/mar\/21\/ ethiopia-centre-global-farmland-rush); Alexis Marant\u2019s film Planet for Sale(http:\/\/farmlandgrab.org\/post\/view\/18542); the studies on land deals in Africa being released by the Oakland Institute (http:\/\/media.oaklandinstitute.org\/land-deals-africa); the Dakar Appeal against land grabbing, drawn up by participants at the World Social Forum in February 2011 and presented to the G20 agriculture ministers in June 2011 (https:\/\/viacampesina.org\/en\/index.php?option=com_content&view=category&layout=blog&id=23&Itemid=36); and the collective statement against \u201cresponsible\u201d agricultural land investments launched by La Via Campesina, FIAN, LRAN, WFF and GRAIN in April 2011 (http:\/\/www.grain.org\/nfg\/?id=767).<\/p>\n 2 Sovereign wealth funds, by comparison, hold about US$4 trillion in assets.<\/p>\n 3 Commodities are basic goods and services that are bought and sold in bulk \u2013 such as oil, gold, rice, coffee, copper or beef. \u201cBasic\u201d means that they can be used, like raw materials, to make other goods or services. And \u201cin bulk\u201d means that the item can be pooled from various sources, with a high level of uniformity. Thus a sack of rice or a barrel of oil may be composed of rice or oil coming from various fields or pumps, as long as they have similar basic qualities. Commodities, following the breakdown used by onValues Investment Strategies and Research in a recent report for the Swiss government, are often traded today in the form of futures contracts, physical stocks, so-called \u201creal\u201d assets (like land) and equity in firms that hold productive assets. See Ivo Knoepfel, \u201cResponsible investment in commodities: the issues at stake and a potential role for institutional investors\u201d, project co-sponsored by the Swiss Confederation, PRI and Global Compact, Zurich, January 2011, p. 3 (available athttp:\/\/farmlandgrab.org\/post\/view\/18339).<\/p>\n 4 Though some still try to deny it, many people \u2013 from investment bankers to civil society organisations (CSOs) \u2013 have argued and shown how commodity investors are in fact fuelling the current food-price hikes, particularly since the financial meltdown of 2008. Some recent accessible CSO analysis on the matter include the World Development Movement\u2019s work on food speculation (http:\/\/www.wdm.org.uk\/food-speculation) and material prepared for Oxfam\u2019s GROW campaign (http:\/\/www.oxfam.org\/en\/grow).<\/p>\n 5 See Ivo Knoepfel, op. Cit., p. 2.<\/p>\n 6 Ibid., p 16.<\/p>\n 7 Many of these land deals are not investments in any productive economic sense. Rather, they are financial schemes to generate returns on capital in the form of rent. See the analysis by Hubert Cochet and Michel Merlet, \u201cLand grabbing and share of the value added in agricultural processes. A new look at the distribution of land revenues\u201d, paper presented at the international conference on Global Land Grabbing at the Institute of Development Studies, University of Sussex, UK, 6\u20138 April 2011,http:\/\/www.future-agricultures.org\/index.php?option=com_docman&task=doc_download&gid=1174&Itemid=971<\/p>\n 8 Some of the biggest funds allocate as much as 7% of their portfolios to commodities.<\/p>\n 9 Knoepfel, op. cit., p. 14.<\/p>\n 10 Sarah Anderson, \u201cFood shouldn\u2019t be a poker chip\u201d, IPS, Washington DC, 15 November 2010, http:\/\/www.ips-dc.org\/articles\/food_shouldnt_be_a_poker_chip. For more information, see \u201cStop gambling on hunger\u201d, http:\/\/stopgamblingonhunger.com\/?page_id=838<\/p>\n","protected":false},"excerpt":{"rendered":" Large scale agricultural land acquisitions are generating conflicts and controversies around the world. A growing body of reports show that these projects are bad for local communities and that they promote the wrong kind of agriculture for a world in … Continue reading <\/a><\/p>\n
\nFund \tTotal assets under management (AUM) \tGlobal farmland investment portion\u2026(% of AUM) \t\u2026and its status
\nAP2 (Second Swedish National Pension Fund) \tSEK220 billion
\n[US$34.6 billion] \tUS$500 million in grain farmlands in US, Australia and Brazil (1.4%) \tPlanned joint venture with TIAA\u2013CREF.Firstforays into farmland investing were in 2010
\nAPG (administering the National Civil Pension Fund), Netherlands \t\u20ac220 billion
\n[US$314 billion] \t\u20ac1 billion (0.5%)
\n[US$1.4 billion] \tA planned increase
\nAscension Health, USA \tUS$15 billion \tUp to US$1.1 billion (7.5% target) \tLooking to invest in farmland for the first time, to help meet a real assets target of 7.5% that is currently underachieved
\nCalPERS (California Public Employees\u2019 Retirement System), USA \tUS$231.4 billion \tAbout US$50 million (0.2%):
\n\u2013 US$1.2 million directly invested in Black Earth Farming
\n\u2013 US$47.5 million invested in agribusiness firms with huge int\u2019l farmland holdings: Golden Agriresources, Indofood, IOI Corp, Olam, Sime Darby, Wilmar \tCurrent
\nDow Chemical, USA
\nnot revealed \tFarmland addedrecently. Aimed annual returns on US holdings: 8\u201312%
\nNew Zealand Superannuation Fund \tNZ$17.43 billion
\n[US$14.2 billion] \tNZ$500 million (3%)
\n[US$407 million] \tThe 3% allocationhasbeenmade at the Fund\u2019s strategy level. First purchases into domestic farmland have started, to be followed by overseas farmland holdings
\none US \u201cstate teachers fund\u201d (CalSTRS?)
\nUS$500million\u2013US$1billion
\nPGGM (Pension Fund for Care and Well-Being), Netherlands \t\u20ac90 billion
\n[US$128 billion] \tnot revealed \tMayraise farmland allocation in 2011
\nPKA (Pensionskassernes Administration), Denmark \tUS$25 billion \tUS$370 million (1.5%) \tByApril 2012. In June 2011, made a first placementof US$50 million in SilverStreet Capital\u2019s Luxembourg-based Silverland Fund, targeting primarily Zambia
\nsome \u201cnational government employees pension fund\u201d
\nUS2\u20135 billion \tPlannedsoon
\nSonoma County Employees\u2019 Retirement System Association, USA<\/p>\n
\nTIAA\u2013CREF (Teachers Insurance & Annuity Association \u2013 College Retirement Equities Fund), USA \tUS$426 billion \tUS$2 billion in400 farms in North and South America, Australia and Eastern Europe (0.5%) \tCurrent. They claim annual returns of 10%<\/p>\n
\n2. they are reportedly going to do it very soon;
\n3. the new surge in money will push up global food prices;
\n4. high food prices will hit poor, rural and working-class communities hard.<\/p>\n