Download your FREE Farmland Investment and Agricultural Investment Guide here
Argentine President Cristina Fernandez on Wednesday reiterated plans to limit the ability of foreigners to purchase farmland.
Fernandez said she would submit a bill to Congress this year to "protect the jurisdiction of land so it will continue to belong to the Argentine Republic."
Fernandez made a similar announcement on March 1. As she said back then, the bill will not be "xenophobic or chauvinistic."
In what seemed like a campaign speech, Fernandez told an arena full of supporters late Wednesday that Argentina won't be "inventing anything new" with this bill. Instead, she the bill will be similar to related laws already in place in other countries.
Download your FREE Farmland Investment and Agricultural Investment Guide here
Pressure has been building in Argentina to limit the amount of land that foreigners can buy, as record prices for grain and derivative products fuel concerns that deep-pocketed overseas investors might end up controlling a significant percentage of the country's farmland.
Last year, congressmen from across Argentina's political spectrum sponsored about 12 different bills that would have put limits on foreign land ownership.
Agriculture exports were largely responsible for Argentina's $12.06 billion trade surplus last year, while taxes on farm exports accounted for a significant percentage of the federal government's tax revenue.
Download your FREE Farmland Investment and Agricultural Investment Guide here
Argentina is the world leader in soymeal and soyoil exports, ranks No. 2 in corn exports, and third in soybeans. It is also one of the world's top beef exporters.
As global commodity prices soar, investors have increasingly looked to the fertile farmlands of Argentina and Brazil for investment opportunities.
That has helped fuel surging land prices in recent years. At the end of 2010, prime farmland in Argentina's Buenos Aires Province was selling for $15,000 a hectare (2.47 acres), according to local daily La Nacion. That is about double the price in 2007 and over five times prices in 2002 when the country was in the midst of an economic crisis.
Download your FREE Farmland Investment and Agricultural Investment Guide here
Argentina's northern neighbor, Brazil, has already taken steps to protect its national sovereignty over farmland. Last year, Brazil's former President Luiz Inacio Lula da Silva placed limits on foreign ownership.
In Argentina, about 7%, or 20 million hectares, of the country's productive farmland is in the hands of foreigners already, according to the Argentine Agrarian Federation.
Download your FREE Farmland Investment and Agricultural Investment Guide here
Source: Bloomberg