Craigmore highlighted resilient demand for investing in dairy, despite the global market downturn, as it revealed it had raised NZ$75m ($51m) for its second New Zealand farmland fund, 14 months after closing its first.
The New Zealand-based farming and investment group, which owns some 30 farms in New Zealand, revealed the first closure of its second fund, Craigmore Dairy Partnership II, which aims to take its total investment to NZ$350m ($237m) next year.
The milestone, with funds raised from institutional and private investors, follows the finalisation in September last year of the group's first fund, Craigmore Farming Partnership, with NZ$250m.
And it comes despite the downturn in dairy commodity prices which, while having rebounded from 13-year lows reached in August, remain at depressed levels, below the cost of production in many countries.
Prices at GlobalDairyTrade, the physical auction run by New Zealand-based dairy giant Fonterra, have halved over the past two years
However, investors "understand that all ag commodities are cyclical", Nick Tapp, chairman of UK-based Craigmore Sustainables, the part of the Craigmore empire in charge of the latest fund, told Agrimoney.com.
"Demand growth in whichever market is pretty constant at about 1.5-2% a year," driven by a growing and increasingly wealthy population.
"People look through the short-term price volatility to the long-term competitive advantages of investing in a safe place, with good land," and, in New Zealand, what Mr Tapp termed a "big advantage in cost of production" over other milk-exporting countries.
In the Europe Union, for instance, "we are seeing some producers finding it difficult to be competitive".
The 2.6% year-on-year increase in EU milk output in the six months after milk production quotas were ditched at the end of March disguises variation within individual countries varying between 12.9% growth in Ireland to contraction of 9.8% in Romania.
In fact, the New Zealand dairy farm market, which Craigmore estimates at NZ$100bn ($68bn), has not been immune to the dairy downturn, with data from the Real Estate Institute of New Zealand showing values down 18.6% year on year in October.
Values had, however, shown some winter recovery, coming in 6.0% higher in the August-to-October period than the average for the July-to-September quarter.
And Craigmore was viewing depressed prices as a buying opportunity, saying that it was "already looking at some very good farms" for its new fund.
Indeed, the fund was expecting to "purchase some really good farmland assets early in the new year", Mr Tapp said.
"The New Zealand land market is relatively liquid, and there are farms coming onto the market all the time."
The first fund also invested some cash in the broader dairy sector, such as dairy support farms, and with some cash invested in New Zealand beef and horticulture too.