A great time to own land in Argentina

Nervous investors have backed away from Latin America’s agriculture sector after food prices fell. But the sell-off is a great opportunity to buy in, says James McKeigue. Here, he picks the best way.

This has been a painful year so far for Latin America's farmers. From Colombia's coffee heartlands to Argentina's rolling pampas, farmers are being hit by falling prices. Sugar is down around 50% from its 2010 peak, while coffee has fallen by more than 50%. Cereals, which are also down 24%, look likely to take another hit later on this year as analysts expect America to deliver a record-breaking grain harvest. It's been a rude awakening.

Unsurprisingly the price drops have scared investors. In times of a food crisis people often blame speculators', the non-agricultural investors who buy into soft commodities for pushing up the price. But it works both ways. When these speculators get cold feet they can often exacerbate price drops too. And that's exactly what's happening at the moment.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free
https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up
James McKeigue

James graduated from Keele University with a BA (Hons) in English literature and history, and has a certificate in journalism from the NCTJ. James has worked as a freelance journalist in various Latin American countries.He also had a spell at ITV, as welll as wring for Television Business International and covering the European equity markets for the Forbes.com London bureau. James has travelled extensively in emerging markets, reporting for international energy magazines such as Oil and Gas Investor, and institutional publications such as the Commonwealth Business Environment Report. He is currently the managing editor of LatAm INVESTOR, the UK's only Latin American finance magazine.