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Tuesday, 23 January 2018

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Managed farm investments in Brazil

Welcome! Forums Real Estate and Private Investments Managed farm investments in Brazil

This topic contains 8 replies, has 5 voices, and was last updated by  nawrockp 4 years, 1 month ago.

Viewing 9 posts - 1 through 9 (of 9 total)
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  • #17627

    Mark
    Participant

    I am wondering if any members have any thoughts on two Brazil agricultural investment opportunities I cam across, which were recommended by Lief Simon and Kathleen Peddicord. Investors buy the land freehold and hire a management company to oversee the farming, harvesting, selling the crops, paying the taxes, and sending you the proceeds. The two crops are coconuts and neem (which is used for a natural pesticide, fertilizer, and other uses)

    http://www.the-liquid.com/projectdetails/green-investments/brazil/coconut-plantations/fazenda-lagoa-grande/overview.html

    Here are some writeups on the projects by Lief Simon:
    http://www.liveandinvestoverseas.com/read-2011-articles/agricultural-investing-in-fortaleza-brazil-oct-21-2011.html
    http://www.liveandinvestoverseas.com/read-2012-articles/touring-fortaleza-brazil-coconut-plantation-investment-opportunity-11-may-2012.html
    http://www.liveandinvestoverseas.com/read-2012-articles/investing-in-neem-in-brazil-10-aug-2012.html
    http://www.liveandinvestoverseas.com/general-category/neem-liquid-project.html

    And an overview of the two investments:
    Coconut crops start producing profits in year 4 with full potential production starting in year 6. 36% ROI potential for up to 60 years. Projected IRR of 17%. $30,000 per hectare up to 9 hectares, then $27,500 per hectare through 19 hectares.

    Neem crops start producing profits in year 3 with full potential production starting in year 8. By year 7 though, the neem and coconut profits are about equal. From years 8 on, projected neem profits can be 48-53% ROI for up to 200 years. Projected IRR of up to 22%. $30,000 per hectare up to 5 hectares, then $28,500 up through 11 hectares.

    Any thoughts on the opportunities that you would like to share as I dig into due diligence?

    #27079

    KAILASH N.
    Participant

    hi mark
    I have recently talked to “liquid investments” sales guy about this project and read the links.
    it sounds like a good option to me but I have never done anything like this before.
    have you invested yet?
    kai Narayan
    614 593 2462
    Columbus ohio

    #27081

    Mark
    Participant

    Hi Kai – I have not gone ahead, but it still does look like a good opportunity for a longer term private investment. I would consider making the trip down to check out the land you’ll end up owning (good excuse for a working vacation to Brazil). I’ve just been sidetracked with other things and I’ve been looking more for shorter term projects (with the longer term looking so murky). While I know little about neem, I doubt coconuts will become undesirable in the future. There are some risks/considerations (currency, Brazil taxes & regulations, whether Liquid stays liquid for decades to come, the future supply/demand of these crops, how to sell the land afterward, etc.), but I still like the odds. Happy to chat more and would love to hear if you do move forward (you can private message me too).

    #27086

    LINN B.
    Member

    Hi All
    I have been to Live and invest overseas conference in Panama. Heard Liquid Investments presentation several things
    concerned me.Price per hectare of 27.5 to 30K. Second investing in UK company managing Brazilian land makes contract
    Litigation difficult. Brazilian courts are NOT VERY gringo friendly. ROI sounds to good to be true. Another Ago. option
    is farmland in Uruguay. You can own land directly in your own name with no reporting to US requirements.Yes if land
    produces income to have to report. ROI of 6% Contact Juan Federico Fischer at jfischer@fs.com.uy, or http://www.fs.com.uy
    It not return on investment that’s important but return of investment. Very productive farmland can be had 10K per hectare. Yes there is cheaper land but it is not as productive.

    #27094

    DALE D.
    Participant

    Hi All – Regarding the farmland investments, I was also looking at both the Liquid Investments in Brazil and farmland in Uruguay. Lynn, have you moved forward with the farmland in Uruguay investment or do you know of anyone that has invested?

    #27095

    LINN B.
    Member

    Hi Dale
    Yes I have completed the purchase of Uruguay farmland. The return cash on cash is about 6% no including appreciation
    if any. The main comfort factor is land can be titled in your name. It has real economic value not related to a unique
    use but to the production of wheat and soybeans.
    Linn

    #27097

    RANDY L.
    Participant

    Linn, If you don’t mind me asking…….What are you growing, roughly what investment amount necessary to get started and what kind of farm management agreement did you make? Also, what entity did you choose to own the land, or do you own it in your name?
    Randy

    #27099

    DALE D.
    Participant

    Hi Lynn – Thanks for the information. In addition to Randy Long’s questions, what service does Juan Federico Fischer. Does Juan help you with the purchase of the property as well as the farm management? Thanks. //Dale

    #18112

    LINN B.
    Member

    Hi All
    If you buy farmland you can plant twice a year producing wheat and soybeans. Ranch and forestry properties are
    available but I believe these are more management intensive.There are two routes on farm management you can
    cash rent per acre or pay the farm manager a set fee for service. Cash rent has lower rate of return about 4%. Fee for
    service ROI of 6 to 8%. Fee for service has more risk and time commitment. I choose to take title in an entity but I
    wish I had taken it in my name. Tax compliance is high with entity. A control foreign corp tax return is not cheap.
    Investment amount necessary should be over 300KUSD. Your purchase options are limited below that amount.
    Juan Federico is an attorney he has a full service firm. Can help with residency,land purchase, farm management,
    local accounting and second passports. He is multilingual check out website link on my sept 11 post.

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