Agrimoney caught up with Paul McMahon, Managing Partner at SLM Partners to see why he thought investors should be looking more closely at sustainable investment. Mr McMahon is speaking at the Agrimoney Investment Forum on June 14 and 15 in London. Full event programme and booking details here: www.agrimoneyinvestmentforum.com
Ecological farming methods can offer protection against volatile input and commodity prices, and environmental regulation, says Paul McMahon, partner and founder of SLM Partners.
SLM runs a 480,000 hectare cattle business in Australia, and is in the process of launching a sheep-venture in Chile.
The business is not focussed on organic production, but instead on the reduced use of conventional inputs, through stock and soil management techniques.
One such method is the use of 'mob grazing', where stock are grazed at higher densities in well-grown pasture for short periods of time before moving as a mob to the next paddock.
"We can double the carrying capacity and halve the cost of production," Mr McMahon says.
Minimising the use of conventional inputs will shelter the business from price volatility, Mr McMahon says, while the environmental focus offers protection against more stringent regulation.
"In November 2015, some of the properties that SLM Partners manages in Australia successfully bid to supply in excess of 2 million tonnes of CO2 credits to the country's Emissions Reduction Fund," Mr McMahon sys.
"This will generate significant extra revenue for these properties."
With only a tiny proportion of the estimated US$10bn invested in land funds in the last 10 years going into ecological farming, the sector remains a niche one.
"But we have seen a lot of interest as investors have begun talking about environmental impact, soil carbon and the Paris talks."
Mr McMahon has written a white paper on 'The investment case for ecological farming'. Download a copy here http://slmpartners.com/news-research/slm-research
By Emma Penny, group head of cont