Agricultural Land Certificate
Safe and sustainable agricultural land investment through objective satellite-based assessment
The availability of productive land is not only very limited, but also dwindling. In Germany alone, between 1992 and 2012, an average of approximately 100 hectares (247.1 acres) of agricultural land disappeared every day, mostly caused by the spread of cities and transportation areas. In other parts of the world, problems like “desertification” (the spreading of desert land and erosion) play a significant role. Nevertheless, the same basic conditions apply everywhere: agricultural land is not artificially producible, and once degraded or contaminated, it is unusable for generations.
On the other hand, there is an enormous demand for food products, and the trend is increasing. This is not only due to the spike in world population, but also due to the changing eating and living habits of developing countries. The consumption of meat, energy and raw materials is growing steadily, and accordingly, also the demand for animal feed, bio-energy and plant products. Today, only around 10% of total global land surface is used as arable land. This area produces almost four times as much animal feed as it does food. It is no wonder that the price of agricultural land has grown massively in recent years- both regionally and globally- but, it has not risen everywhere.
Risk and Security
Among investors, the class of assets “land” is no longer insiders’ knowledge, because it offers a real alternative to common forms of investments. Even though land is a tangible, material asset, factors like risk and security are still of concern.
The risk of misjudgment in evaluation is significant in this market. Even an on-site appointment is often useless to the lay person. Not infrequently, investors are also faced with fraud, which considerably limits the security of returns.
In addition, there are dangers invisible to the human eye, such as the effects of climate change, like drought, or the consequences of weather phenomena, like “El Niño.”
Why not buy where everyone is buying? It is easy to visualize the parts of the world where extensive land investment is common. What is not so easy to see are the long-term difficulties that are to be expected, for example, in a region like East Africa or South Asia. Above all, the boundaries surrounding land grabbing, i.e. the irresponsible acquisition of agricultural land, are blurry, which can cause problems more severe than merely a damaged reputation.
Land ownership is one of the oldest human desires. In addition to the strategic goals of land ownership, the acquisition of a natural resource was important in former times, just as it is today. While it is true that man has learned to improve the quality of soil through fertilization and artificial irrigation, the fact remains that even after thousands of years, fertile soil can not be artificially produced. In general, land is and remains a scarce and in-demand commodity. This alone is a reason for investing capital in land.
In addition, there are many opportunities to make a difference in the world. You could be supported by a competent team in your venture to change the world.. The first step is deciding where to purchase land. Is the tropical rainforest really the best place to invest, just because it’s a popular choice? Or is there a more meaningful alternative available: a potential win-win situation, both for investors as well as for the local population and the environment? Likewise, there are many options for cultivation alone: ecologically or conventionally? Wheat or hazelnuts? The chance to combine a return on investment with the opportunity to create change is within reach – you just have to use it.
Spatial Business Institute AG can answer questions that are unavoidably connected with the acquisition of agricultural land:
Where is there lucrative land? What can be cultivated sustainably? What are the expected yields, as well as the economic and ecological opportunities and risks?
SBI uses satellite sensors that measure location and plant properties with information-based precision and more objectively than is possible for the human eye. We combine this precise information with other factors such as weather, soil parameters, and climate projections for future scenarios.
The principle of “result at the push of a button” is, after all, based on decades of experience in dealing with satellite, geographical, soil and weather data, combined with in-depth expert knowledge about agriculture and forestry. This is the only way to make reliable diagnoses and simulations. This information from SBI minimizes risk and enables a safe and sustainable investment in agricultural and forestry land.
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