Through a meeting today with business men and women representing M&A Advisory, Accounting firms and Legal Services industries in the WA market, there seemed to be an interesting message coming through – China is investing in Australia, but not only in Mining & Resources. The trend looks like a possible and increasingly ‘re-focus’ on Agriculture.
Present at the meeting was a legal professional who worked for a very reputable legal services firm. When we talked about recent acquisitions and mergers in WA, it wasn’t the usual ‘miner’ or ‘explorer’ resources stories we are so used to hearing about in WA. The conversations were about ‘dairy’, ‘olive’ and other fresh produce-related acquisitions.
Given the massive urbanization in China’s mega cities and second tiered cities, it shouldn’t be surprising that the mass-exodus from China’s agricultural land to the cities is going to affect the gross domestic production of agricultural products, aka ‘food’. An increasing demand for Australian agricultural product is something we are likely to hear more of in the media, and the debate on sovereign risk and ‘national interest’ is only going to get hotter. The question is, is Australia ready for attention to be focused on its agricultural industry?