Three British businessmen have set up a fund to invest in agriculture in Russia and elsewhere in the CIS, turning to a largely neglected industry with vast investment opportunities.
Investing in the abysmal infrastructure of Russian agriculture is the chief objective of the fund, which has an equity target of $150m and is managed by Agriculture Infrastructure Management Consultancy (AIMC, www.aimc.su), a Cyprus-domiciled company operating out of Moscow.
Poor storage conditions make Russia lose up to half of its home-grown vegetables and plug the gap with imports.
AIMC, which offers services such as designing and building farm facilities, consultancy, valuation and personnel training, is negotiating a number of deals that are due to be closed soon, AIMC chief executive and co-founder Greg Thain told EmergingMarkets.me.
Russia, whose grain fed half of Europe in the 1850s, has vast tracts of what is some the world’s best arable land, but only about 35% of it is used for farming, with about 200m hectares (500m acres) still waiting to go under the plough.
The country has a good railway network; its agrarian sector has relatively low labour and fuel costs and possesses a workforce that includes a lot of well-educated people.
Russia borders China and is not far from India, which are vast food markets because of their huge populations.
Greg Thain, whose 35-year business career includes top executive jobs in many countries, is one of the founders of the fund.
The other co-founders are Jonathan Tubb, AIMC chief financial officer who is simultaneously executive director of Moscow-based consultancy and audit firm Bellerage Vostok, and Tony Stamford, AIMC operations director and owner of a logistics and transport firm in Russia.