Can agriculture bear fruit for investors?

As assets all around are taking a tumble, agriculture is showing signs of life. But just how healthy are these green shoots? Tim Bennett finds out.

The 'great recession' has been painful for investors in most asset classes, and agricultural ('soft') commodities have been no exception. Last February we warned readers to be wary of a bubble in softs when the price of wheat shot up by 25% in a single day after Kazakhstan announced it would impose export tariffs. Now that this bubble has popped along with the rest of them, evidence of the fall-out is everywhere.

Schroder's Agriculture Fund, for example, is valued at around $1.5bn, down from $6.4bn at the time of our warning. Land prices in the once red-hot Ukraine have tumbled: at the start of 2008, leases of between two and 20 years were being sold for around $1,000 per hectare; now they're more like $250 per hectare, say consultants Brown and Co. And the broad Rogers International Commodity Index fell by around 50% in 2008.

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Tim graduated with a history degree from Cambridge University in 1989 and, after a year of travelling, joined the financial services firm Ernst and Young in 1990, qualifying as a chartered accountant in 1994.

He then moved into financial markets training, designing and running a variety of courses at graduate level and beyond for a range of organisations including the Securities and Investment Institute and UBS. He joined MoneyWeek in 2007.