Global agricultural investor Nuveen Natural Capital has joined a growing pool of institutional fund managers targeting Australia’s burgeoning macadamia sector, after buying one of the country’s largest orchards near Bundaberg for more than $70 million.

 

Macadamia Enterprises, owned by the Manera family, was put on the market in February offering 106,000 macadamia trees planted across 344 hectares at Calavos, just south of the Bundaberg CBD.

 

Included in the sale was a state-of-the-art nut sorting facility and more than 1600 megalitres of water entitlements.

 

Last year, Macadamia Enterprises produced 1478 tonnes of macadamia nuts (in shell) as part of a sector that produced 55,000 tonnes in total and which has expanded by 57 per cent in eight years, according to the Australian Macadamia Society.

 

Well placed sources identified the buyer of Macadamia Enterprises as Nuveen Natural Capital (previously called Westchester) and suggested the purchase price was about $71 million.

 

Selling agents Baden Lowrie and Mark Barber from Elders Real Estate declined to comment.

 

Nuveen, which invests on behalf of the $1.8 trillion US teachers pension fund TIAA, manages $15 billion of agricultural investments globally. These comprise about 600 properties in 10 countries and a combined 1.2 million hectares of farmland.

 

Nuveen’s $2 billion Australian portfolio spans 69 properties and 367,000 hectares of farmland. It includes investments in row crops, horticulture and sugar cane predominantly in Western Australia and NSW.

 

Nuts for growth
 

Speaking to The Australian Financial Review in August, Nuveen Natural Capital’s global boss Martin Davies said the investment manager was “very interested” in increasing its permanent crop exposure in Australia. Alongside its acquisition of Macadamia Enterprises, Nuveen also has investments in almond orchards.

 

Also keen to grow its macadamia investments in Australia is giant Canadian pension fund investment manager PSP, which earlier this month acquired the Casella vineyards portfolio.

 

The Financial Review understands PSP (the Public Sector Pension Investment Board) is the frontrunner to buy another major local macadamia enterprise, Macadamias Australia.

 

Macadamias Australia is a division of the Steinhardt Group which was founded in 1958 by Ron and Marion Steinhardt.

 

The Steinhardts planted their first macadamia trees in 2004 and now maintain more than 200,000 trees and harvest about 2000 tonnes of nut-in-shell each year. According to its website, Macadamias Australia is “the largest family owned vertically integrated macadamia business in the world”.

 

PSP has about $1 billion invested in Australia’s nut industry through Stahmann Webster (after its takeover in 2019 of Webster Limited) which grows walnuts, pecans, macadamias and almonds.

 

Macadamia is a sector where Australia has a comparative advantage over other regions given its success in developing more productive macadamia tree species and because macadamias are native to Queensland, meaning they tend to thrive in local soil and climatic conditions.

 

Australia’s expanding macadamia sector exports almost 80 per cent of its crop and is approaching $1 billion in annual retail value.

 

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