A report at BNN (Bulgarian News Network) provides an interesting perspective to investing in agriculture – be it a sheep farm or a winery:
The common agricultural policy of the EU determines the quantities of different cultures that a member country can produce. So if you rely on some bureaucratic decision taken somewhere in Brussels, you may be unpleasantly surprised.
If you have invested, let us say, in vineyards, it may turn out that there is too much grain production in Bulgaria already and your production asset will bring you less income than you expected. This is where the basic advantage of funds lies as compared with direct purchase of land. Thanks to their bigger volume, funds can diversify their portfolios.
That’s an interesting twist on diversification when it comes to investing in agriculture. Next week’s tip: mix sheep, dogs, foxes, and hens to minimize risk 