Farm Development

Investment Strategy

FARM DEVELOPMENT

Agro Concept Management partners with a reliable and highly experienced farm management company, specializing in cattle farm development, specifically in the western part of the State of Bahia. In addition, we work with local farmers that have extensive experience in cattle raising and breeding, operational activities as well as in sales on the local market.

Western Bahia has soil and climate conditions which are highly favorable for raising grass-fed cattle for beef and dairy. As a result, it is one of the most productive places on the planet for cattle raising. Compared to other types of agriculture, investment in a cattle farm ca be lucrative for a short-term period. This type of investment provides high yearly returns and has much lower material, technical, and personnel costs.

FIVE REASONS TO INVEST TODAY IN BRAZILIAN CATTLE FARMS

Global demand for meat is growing, especially for beef. For instance, over the past 50 years meat production has more than quadrupled. The world now produces more than 320 million tons each year.

As the world’s largest exporter of beef, Brazil currently provides close to 20% of total global beef exports. Moreover, this steady export growth trajectory should continue for the next decade. Experts estimate that by 2028, beef exports will reach 2.9 million metric tons, or 23% of the world’s total.

Brazil has the world’s second-largest cattle herd—232 million head.

In addition to a large internal consumer market, Brazil has strong export partners. These include China, Hong Kong, South Africa, Iran, Iraq, Myanmar, Malaysia, Singapore, and the Middle East. Moreover, Brazil is currently the largest producer of halal meat.

Brazil has highly developed technology for the cattle farming and agriculture industries.

WESTERN BAHIA, BRAZIL

Western Bahia is known as a large agricultural region and large producer of crops for export. Crops include soybeans, coffee, sugarcane, and cotton, along with beef and livestock. The region has unique characteristics that increase its potential for large-scale mechanized farming. The landscape is dominated by massive plateaus with dimensions of 300 by 200 km, which are conducive for developing large farms.

The region has a sufficient amount of water due to rainfall of up to 1,800 mm per year, three major rivers and the Urucuia Aquifer. In addition, warm weather, low risk of natural disasters and affordable land prices make it an ideal place for agricultural and farming investments today!

However, land prices are forecast to rise steadily due to the infrastructure improvements being made in Western Bahia. For example, the construction of the West-East railway and seaports will allow a significant reduction in transportation costs when compared to the current costs for road transportation. The railway will significantly reduce time and expenses for farmers exporting goods out of the region. So today is the time to invest!

FARMING MODEL

Activity

Cattle breeding and raising or crop production farms using irrigation

Location

Brazil, West Bahia region

Minimum Size

1 000 hectares

Cattle Breeds or Crops

Cattle: Lenore, Angus or Nelore

Crops: soybean, corn, sugarcane, cotton and coffee

Return on Investment

4-5 years using irrigation

Feeding for cattle

Combination of grass-fed and feedlot in the last 90 days

Productivity

6-8 cattle heads per 1 hectare with irrigation

Irrigation

Center pivot (100 ha) system

FARM INVESTMENT PROCESS

Stage 1 - Selecting an investment property

Depending on the size of investment you wish to make, AgCM will present you with investment options. This includes detailed information on the most suitable agricultural land or developed farms from our portfolio. Once you choose from the farms or plots of land, we move on to stage 2.

Stage 2 - Investment options and site visit

Together with our local partner, a farm management company, we present you the best possible options for cattle farm development. We take into account soil, climate and water availability, market demands and legal/tax organization. Once approved, we arrange a site visit to the farm in Brazil or Paraguay. Finally, we organize negotiations with your new potential business partner.

Stage 3 - Establishing legal entity and starting operations

Next, we assist in creating an appropriate legal partnership entity between you and the local partner. Once the new entity is created, details regarding the farm development process are finalized, and you start your operation with the new local Brazilian partner.

Stage 4 - Final steps

When the contract of establishing a partnership and a new entity is signed, AgCM’s obligations are fulfilled. We receive a commission fee as a pre-agreed fixed amount or based on a percentage of the investment.

FARM DEVELOPMENT PROCESS

Stage 1 - Development of pastures and land improvement

Preparation for soil correction
Enrichment of the soil with lime and potash
Planting grass or corn

Stage 2 - Farm infrastructure development

Fence construction
Electrical installation
Installation of cattle treatment equipment (for cattle farm)
Construction of storage facilities
Establish cattle camps (for cattle farm)

Stage 3 - Installation of irrigation

Obtain a project license from the local authorities
Select and purchase irrigation systems
Install and maintain the irrigation systems
Drilling a well (if not available)

Stage 4 - Cattle purchase for fattening and breeding (for cattle farm)

Select the breed and amount of calves and cows to be purchased, according to the business plan

Stage 5 - Farm management

Begin farm operations. This includes management, accounting, and administrative activities