Usually, when Nigerians hear investment, they think of stocks, mutual funds, bonds and real estate. Years ago, that would have been great, but now, with the ever-increasing investment opportunities in agriculture, it is time to open your eyes to the goldmine that is in the agricultural sector. For some reason, even though many of us know and agree that agriculture is a sustainable sector, we’ve ignored the sector long enough.
In the early days, the agric industry was mainly dominated by farmers and people who were passionate about agriculture. However, it is becoming clearer that investing in agriculture can no longer be overlooked. And there are many reasons you should get informed and invest in agriculture in Nigeria. But in case you are still unclear about the benefits you enjoy when you invest in agriculture, now is the time to let you in on some exciting reasons why you should consider agric-investment opportunities. If you’re ready, let’s get to it.
There is no investment without risk; let’s just put that out there in case you are thinking that if you invest in agriculture in Nigeria, there is zero risk involved. Several things could happen that would affect the returns one can get from farming, including erosion, pest invasion, and other issues. Now, before you get discouraged, remember once again that there is no investment without risks, so except you have decided not to invest at all, it is something you have to accept.
What is usually advisable is to know your risk tolerance level, so you can make an informed decision based on that knowledge. Having said that, one reason to consider agriculture is that compared to stocks, for instance, agriculture is a low-risk investment because some products are protected by insurance; plus, geography and commodity diversification also reduces certain risks.
The agricultural sector, like I said earlier, is more sustainable than the stock market because it is not as volatile as the latter. A sector that is somewhat stable promises lower risk than one that is unstable – and agricultural investment is one of the most stable investment categories you can find. While it is not without its risks as already stated above, economic depression will hardly stop the nation from eating. Doubtlessly, we all need food. This implies that agriculture will hardly be affected by economic instability as much as other investment opportunities that rely on the stability of the economy. Another advantage agricultural investment has is the value of the land, which rarely depreciates.
Demand for Agricultural Products
Think about it: do you see a time coming when people will stop needing food, clothes or other agricultural products? As long as there are humans on earth, agriculture will be essential. I mean, agriculture produces two of the basic needs of man, so investing in an industry or sector that produces two of the most basic needs of man is a no-brainer. While more modernised ways of farming will be introduced, agriculture as an industry will never become irrelevant, so you can get into a long-term investment without fear.
Another reason you should consider investing in agriculture is for the sake of diversification. Investment experts will always advise investors to diversify their investment portfolio. That means you should invest your money in different investment opportunities, categories and industries. The idea behind this is that if one investment fails; you will have others to bank on and you would not have lost all you have on the one that failed. So, even if you are used to investing in stocks or mutual funds, you can definitely invest in agriculture in Nigeria as well, even if it is for the sole purpose of diversifying your portfolio.
More and Frequent Returns
Of course, this is dependent on many factors, including the type of commodity, the location of the farm, and more. Regardless, farms are likely to yield more and frequent returns. This is because many crops are usually harvested annually and some are even harvested multiple times a year. So, you can get returns on a short term or long term basis depending on your reason for investment.
You can also invest because you will be helping farmers keep farming and providing the ever-increasing world population with food. The satisfaction that you are part of the greater good is a great motivation to invest in agriculture. And while you are doing that, you will also be getting returns for your investment. We see it as a win-win situation, one you should definitely consider being a part of.
And there you have it; reasons to consider investing in agriculture. If you have decided to invest, you can check our investment opportunities. We’ll love to interact with you and hear your thoughts on agric investment. Feel free to leave us a comment, or two.