Food Security

Growing concerns in the Middle East and North Africa (MENA) about the availability of grains and other foods, now and in the future, have been discussed but little action has been taken. Saudi Arabia has ceased the production of Alfalfa and wheat because of lack of water resources. They import 40% of the barley that is globally traded. The GCC countries (Gulf Cooperation Council) import 70% to 90% of their food including rice and other grains.

The global trend is that the world is requiring much more arable land in the last 50 years, and conversely the amount of land available for agriculture is shrinking.

Bolivia has over 20 million hectares of farmland which 6 million  hectares is under cultivation.  Only 40.000 of that is irrigated. Still they are one of the largest producers of soya in the world.   With a small population of 11.7 million they lack investment to make their agricultural sector grow.

Paraguay is contiguous and has a population of 7.1 million, and has over 1.000.000 hectares of farmland.   Consorcio Agroforestal is working with both countries to provide a wide variety of crop.  The growing season is 365 days and the temperatures are between 59◦F and 88◦F, ideal for maximum production.  Two crops a year are standard in both place.   Both countries are part of the greater Chaco Region.

Abundance of Water

Underlying the Pando and Santa Cruz area of Bolivia and the Chaco region to the east in Paraguay is the Guarani aquifer and the Tabatha aquifer, both very large and deep that are part of the Amazon basin. They are estimated to currently hold enough water for centuries to come. Maximum well depth at this time is 150 meters (500 feet). Only a very small amount of farmland has been tapped for lack of capital to drill wells for irrigation.

Anticretico – A Financing Tool

A time honored but rarely used technique is enshrined in the law in Bolivia as Anticretico. It is a form of a land lease. An Anticretico is not a new concept. It was developed during the Inca period when there were no banks and has remained a technique for participating in real estate use. It is a legal form of business established in the laws of Bolivia. Bank loans are difficult to get and interest rates are high for standard land and building financing.

The owner of the farm property puts it into an Anticretico farm corporation (Corporation) as collateral in return for an investment in a lease of his farm for a set period. The investor provides a separate investment to the corporation for equipment, irrigation, seeds, and working capital. He receives a return annually to amortize his farm lease plus a percentage of the harvest profits for each crop (this amount may vary depending on results.) In addition to his share of the crop profits, the Investor is guaranteed at least his total land lease investment over the course of the Anticretico. If he does not receive it, he owns the farm land, now appreciated in value because of irrigation and improvements. Sale of the output crops can be focused where the Investor wants them to be sold. If the Investor is from country X, and wants the harvest sold in country Y, this is feasible.

This process is overseen by a branch of the federal government, to insure that the terms of the Anticretico are carried out without legal problems for the investor.

An Anticretico corporation is formed. The Investor funds the corporation. The corporation leases hectares farmland for a certain amount of $, The funding is used to develop the land, purchase equipment, and farm tractors, trucks and combines, seed and working capital to plant the leased hectare farmland as quickly as possible. As each crop is harvested and sold over the course of the Anticretico, the Investor received a significant return on investment, and also receives a constant annual percentage of the Anticretico amount (amortized principal and interest —like a mortgage). At the termination of the agreement, the investor will have received a significant return on investment, and the land owner gets his land back. If the venture is unsuccessful in returning the land lease portion of the investment, the investor gets the now improved land which would be worth significant more than at the beginning because of improvements.

Custom Farming

Custom Farming—has been used increasing as a very economical way for large corporations like Cargill or governments to lease “their own” farming operations without the large expense of buying land.  A single crop contract or a multiyear contract is negotiated with a land owner.  The entire harvest belongs to the Investor— at cost—plus ocean freight to deliver it.   Consorcio Agroforestal manages the business details.  The overall cost is far below the Commodity Index price that brokers or governments currently pay.

Farm Management

The Board of Directors has contracted with professional farm managers or the landowner/farmer to use all the latest technology and techniques to insure a maximum yield for each planting. We work with agronomists both domestic and international consultants from the University of Wageningen in the Netherland toward this goal.

Export /Payment

ITF-International Trade Finance handles all export, shipping documents, and electronic payments in 4 days without bank fees and in accordance with ICC eUCP and eURC standards.  They can handle paper transactions as well.  We have worked with them flawlessly for 15 years.

Easy Export Documentation – Payment