DLG e.V. - Investments in agricultural sectors

Farmers in Thailand and Zambia are most likely to invest in their businesses this year

By Martin Lueth

The scale of modernization under way in Thailand’s farming sector is clear from the latest “Chart of the month” from DLG-Agrifuture Insights. On average, about 70 % of farmers in the country intend investing in their businesses.

Thai milk producers are particularly likely to invest, with 90 % ready to spend money on their dairy farming enterprises. Research carried out for the new knowledge brand and platform for international trend analysis in the agricultural sector from the German Agriculture Society (DLG) also revealed very high levels of investment in Zambia, and lower, but nonetheless encouraging, levels of investment in Germany, Brazil, South Africa and Russia

An aging population, and demographic shifts as people move out of rural areas in search of better paid and more-stable employment, has resulted in potential labor shortage in Thailand’s farming sector, and the country’s government has reacted by promoting a move to greater mechanization to increase the productivity of the workers that remain. It also hopes that the introduction of more technology into the agricultural sector will persuade more young people to consider a career in farming.

Future for investments in farming sectors

There was also a large appetite for investment in the African nation of Zambia, where more than 70 % of arable farmers and nearly 70 % of pig farmers planned business purchases. More than 50 y of the country’s dairy and pig farmers also revealed their intention to spend money on their enterprises.

The DLG-Agrifuture Insights chart on investment intentions, which is just one of the trends it is monitoring in international agricultural markets, also reveals that investment is subdued in South Africa. This likely to be a result of government initiatives for a land reform, which includes potential for the expropriation of land from farmers.

Other highlights from the chart indications that dairy farmers in Germany are planning to make up deferred investment, while arable farmers in Russia are investing in their businesses which are benefiting from increased demand for their crops from the country’s growing livestock sector and rapidly growing grain exports. In Brazil, meanwhile, poultry farmers are planning to invest because of the strong and increasing demand for chicken from both domestic and export markets.

There is a large appetite for investments in the African country of Zambia.
Photo: Martin Lueth

About DLG-Agrifuture Insights

DLG-Agrifuture Insights provides its subscribers with greater understanding of the developments taking place in the world’s most important agricultural regions at a time when the sector and its environment are changing rapidly, and technologies, markets and market relations, structures and processes are all in a state of transition.

The findings are reached by questioning a global panel made up of 2,000 future-oriented farmers, with surveys conducted every February/March in the southern hemisphere and every August/September in the northern hemisphere. The conclusions are supplemented by continuous background research and regular interviews with top decision-makers.

A DLG-Agrifuture Insights subscription – in English or German – costs € 1,900 per annum. This covers also DLG membership. Detailed information is available at: www.dlg.org/afi