A Swedish pension fund has become the latest of a series of purchasers of Australian farmland, a buying spree which has fuelled public concerns, and raised discussion over curbs on foreign ownership.
Första AP-fonden, which manages some E30bn of Swedish pension savings, has purchased a 16,000-hectare farm near Henty in New South Wales, in one of its first direct farmland acquisitions.
The deal was reportedly sealed for some Aus$7m, although a spokesman for the fund was unable to confirm details.
And it could spark further acquisitions by Första AP-fonden, whose agricultural investments up to now have largely taken place through other funds, such as those run by US-based Westchester.
"We are trying to see if this could be a good investment," the spokesman told Agrimoney.com, adding that the land would be farmed by a contractor.
"If so, we could to more in the future."
The fund had been attracted to agriculture by the sector's potential for returns which are not closely correlated to those of shares and bonds which form the vast bulk of the Första AP-fonden portfolio.
The fund has also invested in Australian and New Zealand dairy, but agriculture remains a "small part" of overall assets.
The deal is the latest in a series of acquisitions by foreign funds of Australian farmland, with Westchester itself purchasing what was once the country's largest rice farm, the 17,200-hectare Cobran Station also in New South Wales.
Westchester reportedly paid Aus$18m-19m for the holding, which was once owned by Foster's boss John Elliott, and whose irrigated fields are now used largely to sow cotton, with sheep grazed on pastureland.
The acquisition expands a Westchester it says extends to more than 400 holdings in Australia, Europe, South America and the US, and is worth some $2bn,
Other recent foreign purchasers of Australian farmland include China-based textiles giant Shandong Ruyi, which has bought Queensland's Cubbie Station, a cotton enterprise covering nearly 1,000 square kilometres.
China's Heilongjiang Feng Agricultural, part of state-owned conglomerate Beidahuang Group, has spent Aus$52m acquiring land in Western Australia, and is said to have an appetite for more purchases.
However, the extent of the foreign appetite for farmland has raised some disquiet in Australia, which last month opened consultation on the launch of a public register for foreign ownership of farmland.
Australian opposition politicians have proposed a cut to Aus$15m in the threshold for foreign purchases of land requiring approval.
Australia's Foreign Investment Review Board, which estimates that less than 1% of investment from abroad in 2010-11 went into agriculture, is currently obliged to consider only deals valued at Aus$244m or more.
The country's Green party, backed by some independent politicians, two weeks ago opened a campaign to press for a moratorium on purchases of farmland by foreigners.