P e e r V o s s Real Estate - Paraguay, South America farmland properties for sale
Offers virgin land in the Chaco - estancias ranches farms - agriculture investments

other language sites - Wald Investment ventacamposParaguay

Special emphasis is on raw undeveloped fertile land. We believe it offers the best leverage for land appreciation.
And we believe that the Paraguay Chaco currently offers the best opportunities within Latin America.

We offer properties in the following regions and categories :

A. undeveloped virgin (native) forest properties in the Chaco boreal (Alto Chaco)

While the Chaco in geographic terms also encompasses parts of Bolivia and Argentina we are referring here to the western half of Paraguay, extremely sparsely populated and traversed by only few roads. The central, western and northern parts belong to the semi arid tropics with annual precipitations between 550 and 1000 mm, vegetation being low scrub on sandy soils in the dry (550 mm) utmost west, developing into semi dry higher impenetrable forest on fertile sedimentary loamy soils, well drained, in the central N-S belt of the central and northern Chaco (700-1000mm rainfall).

Productive potential and environmental considerations :
Most of the central and northern Chaco Boreal makes for good cattle pasture when the natural forest cover is cleared and artificial pasture sown (intensive grass feeding). Soil properties in general and rainfall partly, namely in the North East, Agua Dulce, are suitable for crop production, too. However today, distances, lack of proper roads and infrastructure make it not economically viable yet.

Clearing natural forest to convert land into cattle pasture is controversial due to its effect on the global carbon balance and climate change, bio diversity loss and soil erosion concerns.
A consideration might be beef possibly needing eco certification to be marketable in the first world some time in the future and beef from cattle grazing on deforested land failing to get certified.

Land banking and carbon credits :
The biomass obtained in form of forest with 1x hectare land purchased, probably for fills a more valuable task then 1x cow does, producing beef while grazing on 1x hectare deforested land. A property owner, who has maintained his forests, will probably at one point get paid for that.
1x hectare dense virgin Chaco forest, costing US$200, might store in the range of 200 tons of Carbon, it may sequester in the range of 2 tons per year, though such estimates are far from exact. Carbon credits (1t CO2e) traded in the US$15-25 range over the last 2 years. Presumed a global scheme of trading "avoid deforestation credits" (REDD) will be established within the next couple of years, a fair guess is that one such hectare could generate an annual income of US$40 (10% p.a.) plus appreciations. A voluntary market for REDDs, still lacking proper standards, does exist already as of June 2010 ECONOMIST article "hostage to fortune" and "money grows on trees"
A recent example of what might be expected for the near future: The Paraguay Forest Conservation Project of Swire Pacific Group aiming at creating that group's positive carbon credit balance, highlighting the potential demand for virgin forest properties.

The Chaco’s general remoteness is a limitation when you want to work the land, it can be a welcome feature when your approach is land banking. Virgin land properties do not require any attention, the ones we list here are in areas (still) sufficiently remote to be left completely alone without risking squatters.

B. cattle ranch properties in the Bajo Chaco

The South and the East parallel to the Rio Paraguay river belong to the semi humid tropics with rainfall between 1000 and 1400 mm, vegetation mostly being a more open high grass and palm tree savannas on heavier improperly drained lowland soils, with inlays of more elevated lands, with dense forest and well drained lighter agricultural soils.
Cattle ranching is done in the Bajo Chaco profitably and more environmentally viable than above, both extensively on natural rangeland (cow/calf) and more intensively on sown pasture (grazing/fattening) with no need to cut palm trees when sowing. It is likely that rice farming will at one moment make inroads into the region.

The Chaco is not for the family farmer

Buyers are typically land bankers, agro corporations, individual farmers residing in Asuncion or abroad. The extreme remoteness, lack of schools, shops, villages makes it rather sacrificing for families to live in the Chaco.

Transactions, restrictions, taxes

foreign landownership is not restricted in any way,
a public registry of property titles exists.

transaction costs :
buyer commission : 3% of sales price
notary fees, stamp fees, taxes : 2% of sales price in total

property taxes : example - 4000 hectare land consisting of virgin forest, as of 2012, US$500 annually.
Taxes, general : personal income tax 10% (though parliament suspended income tax completely during recent years), 10% VAT/sales tax

Property descriptions do not always contain images, the images in the column to the right might give a general first idea.
Access by earth road can become ardous during rainy season, November-March, you do have, however, always the possibility to review properties by chartered plane. The sheer size of properties make this viable in any case.

further reading here - farmland as inflation hedge

Peer Voss
pvoss@pvoss.de

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the farmland news column
some occasional update and news bit also viewable as farmland newsfeed

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02-2013
Germany's SPIEGEL magazine reports on 19.Feb.2013 that EU will take measures to substantially reduce supply of carbon offset certificates, in that way increasing their market price and hence the incentive to reduce emissions altogether ( Emissionshandel: EU will CO2-Zertifikate drastisch verknappen )

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02-2013
Germany's Kreditanstalt für Wiederaufbau (KFW) investment arm DEG says it will invest some €25m in the paraguayan agricultural sector thru a partnership with Rioforte, the agricultural corporation

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01-2013
Though land prices in the Paraguay Chaco continue to rise 20% annually, there is a strong interest by foreign investors in land and farming investments, notably Uruguayan ranchers, say sources from the Chaco ranching sector. Buyers are less and less speculators, but rather agro producers who develop and start producing. Land in the Chaco produces on average 170 kg beef life weight per Hectare per year compared to 100kg in Uruguay (a country where land prices are five times higher),
reports this article of Uruguay’s major newspaper El Pais on 14.Jan.2013 (in Spanish)
“Ganadería guaraní sigue captando más inversores”
http://www.elpais.com.uy/130114/pecono-688284/rurales/ganaderia-guarani-sigue-captando-mas-inversores/

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01-2013
market update 31.Jan.2013
President Lugo being impeached by the Paraguayan parliament in June 2012 seems to have made non-Latin-American foreign investors more reluctant to invest for the moment, at least until the 2013 elections bringing a government to office who’s legitimacy won’t be questioned abroad. Latin American investors, namely Brazilians, Uruguayans, Argentineans invest as strongly in land in Paraguay as in previous years. Land prices rose some 15% annualised in recent months.
Weakness of the US$, in which prices are quoted, is adding to the upward tendency

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09-2012
Paraguay’s ABC-Color newspaper reports on September,4th 2012 on agricultural players perceiving Paraguay, together with Ukraine, as the last countries with substantial potential for agricultural expansion (paraguay-y-ucrania-los-de-mayor-potencial-de-crecimiento-agricola)

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06-2012
market update 19.June.2012
Prices for farmland and virgin land rose some 10% over the last 6 month in the Paraguay Chaco, supply remains relativly scarce, a number of properties being withdrawn from the market is adding to that effect. Expectations from half a year ago, that a local outbreak of Foot+Mouth Disease, while indeed depressing cattle prices somewhat, would lead to lower land prices, did not materialise.
Most foreign buyers come from neighbouring South American countries, Brazil, Uruguay, Argentina, this being an indicator that Paraguay still offers the region’s best price/value in farmland.

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06-2011
Paraguay Ministry of Commerce /Riedex reports that the Karanda'y palmtree's (which covers huge areas of the eastern Chaco as native tree) suitability as Biodiesel crop is currently studied. The palm's seeds have a high content of non edible oil.

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06-2011
A bit older Barron’s cover story about farmland, with Marc Faber on arbitrage opportunities in farmland-rich Russia, Paraguay and Uruguay

property listings - land for sale

(ha = 1 hectare = 2,47 acre, buyer's commission : 3%
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