Looking for something different for your portfolio?
Maybe it is time for you to bump up your BRIC investing, invest in Latin America ex-Brazil or you’d like to get more specific with your agricultural investments. If so, you might have already heard about agroforestry, aka tree farms, and specifically, the wealth of Brazil’s eucalyptus plantations.
Agroforestry and Brazilian Tree Farms
Brazilian-based afforestation projects are conducted on previously misused or pasture land in order to help supply the global demand for timber. Eucalyptus forests are preferred over other forest types because they grow up to 15 times faster than traditional forests per hectare, so they are ideally suited to supplying timber needs. Many of these eucalyptus projects are centered in the Bahia region of Brazil, and they generally conduct operations so as not to disturb local land or wildlife, but support it.
One leader in this subniche of agroforestry is Greenwood Management, a Danish multinational that has been in the Bahia region since 2009. They are still a young company, and not publicly traded, so it is not possible to invest with them on an exchange or through your broker. But such companies do still accept direct investment. You would have to look at their sites and learn about the individual guidelines on how to invest with each company, as they all might have different regulations and requirements.
The Latin America-China Connection
Of all the emerging markets, Latin America is still hot. They have ramped up bilateral trade with the Asia-Pacific, especially China, and both regions have established direct currency trading and/or alternate currencies to the USD for regional trade purposes. Investing in Latin America is thus a good way to indirectly benefit from Chinese growth, too. Just as investing in Chinese companies benefits from African resources (those are the facts, like it or not).