Chinese ownership of Australian farming land has climbed above three million hectares as an increasing number of Chinese investors show their interest in Australian agriculture. A flurry of significant land sales in recent months, mostly in Western Australia (WA), has driven the amount of Australian agricultural land owned by Chinese investors to more than three million hectares, more than double the 1.46 million hectares reported by the Australian Taxation Office (ATO) in June…Full Article: China Daily Nov 2016

Key Point

  • Chinese interests [see Tianma Bearing Group] own 705,000 ha in the stations/ranches of Wollogorang and Wentworth, Northern Territory and Queensland. In addition, Chinese interests own 639,500 ha in the stations of Balfour Downs and Wandanya, Western Australia. Shanghai Zenith, the Australian branch of Shanghai CRED Real Estate Stock, owns Mount Elizabeth Station (200,000 ha) and Yakka Munga Station (189,000), Western Australia. Shanghai Zhongfu, another Chinese real estate developer, owns Carlton Hill Station (476,000 ha), Western Australia.

ChinaAg Comments

  • In October 2016, Gina Rinehart’s Hancock Prospecting and Shanghai CRED Real Estate Stock offered to purchase S. Kidman and Co. for US$277 million. Hancock Prospecting would own 67% while Shanghai CRED Real Estate Stock would own the remaining 33%. Later in the month, they increased their bid to AU386.5 million [~US$292 million].
  • In late April 2016, the Australian government preliminary vetoed the sale of S. Kidman and Co. to Shanghai Pengxin once again. Shortly thereafter Shanghai Pengxin withdrew its bid.
  • In March 2016, Australia’s Foreign Investment Review Board (FIRB) approved the acquisition of Carlton Hill station by Kimberley Agricultural Investment (KAI). As a result of the purchase, KAI (aka Shanghai Zhongfu Group) may invest in a sugar/biofuel mill, cotton gin, cattle abattoir and grain grading facility near Kununurra, Western Australia. During the same month, Australian Rural Capital has announced it was partnering with Shanghai Pengxin Group to purchase S Kidman & Co Ltd (Kidman). Hunan Dakang Pasture Farming (controlled by Shanghai Pengxin, listed in Shenzhen) has a 51% stake in the Chinese portion of the bid while Shanghai CRED Real Estate Stock (privately held) had the remaining 49% Chinese stake.
  • In the wake of the failed November 2015 deal, Kidman sold its South Australia properties of Peake and Anna Creek in order to allay FIRB national security concerns. Anna Creek was sold to Williams Cattle for approximately AU 16 million (~US$12 million).
  • In November 2015, the Australian government vetoed the sale of S. Kidman and Co., a major cattle operator, on national security grounds. According to Australia’s Treasurer, half of Kidman’s Anna Creek pastoral lease lies within the country’s Woomera Prohibited Area (WPA) testing range in South Australia.
  • In August 2015, representative of S Kidman & Co Ltd stated that final bids to purchase the company will occur in late October 2015 at the earliest.
  • In July 2015, Tianma Bearing Group (SHE:002122) bought (via its Australia branch TBG Agri Holding Limited, founded in August 2014) the stations of Wollogorang and Wentworth, Northern Territory and Queensland. The company also owns the Western Australia cattle stations of Balfour Downs, Emu Downs and Wandanya, as well as Ferngrove Wines.
  • In March 2015, Australia passed a law requiring Foreign Investment Review Board (FIRB) approval for the sale of agricultural land valued over AUD 15 million (~US$10.8 million).
  • In June 2014, Shanghai Zhongfu Group (via Kimberley Agricultural Investments) bought a sugar mill in Kununurra, Western Australia. It was noted that even though sugar production was the long term goal of the Ord irrigation scheme, the mill may be used to process sorghum into ethanol.
  • In November 2012, Shanghai Zhongfu Group won the right to develop 13,400-hectares (US$728 million investment) of farmland in the Ord valley, East Kimberley region, Western Australia.
  • Founded in 1999 and headquartered in Shanghai, Shanghai CRED Real Estate Stock is a private real estate company that was created by the Shanghai Municipal Government.
  • Founded in 1992 and headquartered in Shanghai, Shanghai Zhongfu Group is a private real estate developer. The company manages sweet sorghum (ethanol and biofuel production) and chia seed cultivation in the Ord River region of northern Australia.

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