China's largest agricultural company plans to acquire 200,000 hectares of land in Argentina, Brazil, Venezuela, Australia, the Philippines, Zimbabwe and Russia in 2011, reported Chinadaily.com.cn.

Heilongjiang Beidahuang Nongken Group chairman Sui Fengfu, told the website the group was investing in each country for different reasons.

Heilongjiang Beidahuang Nongken Group chairman Sui Fengfu

"In Venezuela and Zimbabwe, the group mainly provides machinery and laborers, and takes about 20 percent of the harvest in return," he was quoted as saying.

"In Australia, it is mainly through the acquisition of local farmland. In Brazil and Argentina, the business model involves renting land."

Argentina's government is acting to create 'intelligent' laws surrounding foreign agricultural land investment, while a member of the team preparing the law told Diario de Madryn the country was currently seen as the 'main point' of farmland investment by the Chinese.

"They are aware that in Argentina we are trying to curb the indiscriminate sale of land to foreigners, and they want to hurry and close the deals as soon as possible," he was quoted as saying.

The newspaper reported the group's aim was clear and simple: acquire productive land rapidly to help feed the northern Chinese state of Heilongjiang's 38 million inhabitants.

The story reported Argentina was of particular interest to Heilongjiang due to its relatively low-priced land in comparison to other countries, with plans to process grains and oils.

China's Agriculture and Rural Affairs Committee of the National People's Congress deputy director Wang Yunkun, told the China Daily his country should continue to seek farmland overseas due to its technological advantages and land scarcity.

"Countries in South America, for example, have arable land and need our technology and investment, and they welcome our companies. It's a win-win solution," he was quoted as saying.

The obstacles

Last year Brazil implemented laws preventing companies that were more than 50% foreign-owned from holding more than 5,000 hectares of farmland, the China Daily reported.

Last week website Gatewaytosouthamerica-newsblog.com reported Brazil was preparing rules to block foreign governments, state-owned companies and speculators from buying land, but would allow 'genuine' private investors.

Brazil's Agricultural Minister Wagner Rossi told the website the nation wanted to block 'sovereign investors', and while he declined to mention which countries were concerned, to most analysts he was clearly referring to China.

"We need to distinguish properly on the one hand between speculators and sovereign funds, which are a threat to our sovereignty, and on the other side, foreign investors who come with good projects," he was quoted as saying.

Venezuela partnership

Earlier this month Venezuela signed an agreement to form a joint venture food company with Heilongjiang, as the country's president Hugo Chavez praised the Chinese for providing food for their 1.3 billion people and exporting it too, according to Venezuelanalysis.com.

"With the support of China, with the work of all Venezuelans, with scientific work, we’re going to convert Venezuela into an agricultural power on this continent," he was quoted as saying.

Photo: www.Chinabdh com

Source: www.freshfruitportal.com