Permanent crops for eight industries with collective market values of more than $20 billion have good investment potential in the primary sector, agricultural economist Con Williams says.
Williams, who works for the MyFarm syndicate organiser, said pipfruit offers the best mix of investability and opportunity followed by tree planting with carbon credits.
He showed MyFarm seminars for investors and analysts last week a heat map analytical approach across the whole primary sector on factors such as asset values, market revenue, land prices, establishment costs, stage of growth and risk-adjusted returns.
The map helped highlight real value propositions and new industry momentum in which investors are climbing aboard a train that is already moving.
The size of the market and the liquidity are also important factors to consider along with an industry's expansion potential in terms of access to intellectual property, capital and labour.
Some of the crops have seen returns on capital of 10-12% a year over the past five years and might be topping out in terms of the asset values, Williams said.