By Money Times
The expectation is that the Fiagros industry will more than double in size year after year, thus gaining more market space.
If we consult the B3 list where the Agribusiness Chain Investment Funds are listed, the so-called Fiagroswe can see that more than 30 options are available for investment by the general public, already registered and able to receive resources for financing business in the broad chain of agribusiness.
Much has already been done, both in terms of raising funds in the market, which already has significant volumes of funds invested (at the end of 2022 it was about R$8 billion), and in terms of financial resources raised to finance the activities of producers as well as other businesses carried out within the agro-industrial chains.
It is worth remembering that the governing legislation for these funds, Law n. 14.130, of March 29, 2021, and the first regulation by the Securities Commission – CVM, Resolution n. 39, is of experimental and temporary nature – in the very diction of the normative act – on July 13, 2021
Fund Regulation
The regulation in question basically determined that from the “chassis” of Real Estate Investment Fund ( FII) assigned by the fund legislation – we would have three modalities of Fiagro:
- (i) Fiagro – Real Estate (or Fiagro-Land) for investment in farms;
- (ii) Fiagro – Credit Rights (or Fiagro-DC) for investment in agribusiness securities such as Rural Product Notes (CPR), Agribusiness Receivables Certificates (CRA), etc;
- (iii) Fiagro-Participation (or Fiagro-Investments) for investment in companies in the agro-industrial chain and/or other Fiagros that invest in the agro-industrial chain.
After almost two years of regulation, we can say that the picture of the moment, based on the types and modalities of Fiagros registered and operating in the market, suggests that most of the existing and available funds in the market are still of the type focused on investment in land, farms, and therefore lend themselves to producing income for investors derived from land leases and/or other land and farm business.
The idea seems to arise to take advantage of the fixed income “habit” of a portion of the investors in the FII market who have decided to migrate to Fiagro-Imobiliário to diversify their investment portfolios, with a portion allocated in assets linked to agribusiness.
Thus, this suggests opportunities for further investment in other financial and non-financial asset classes in the broader agribusiness chain.
In addition, we notice that there are already a few Fiagro-DC operating, but in terms of volume they are still incipient when compared to the securities issues registered at B3.
The Future of Fiagros
It is worth adding that we did not identify any Fiagro-Participations still in operation, and perhaps because the “chassis” of real estate funds “borrowed” from Fiagro does not suit such funds, as it suits Fiagro-Real Estate and Fiagro-DC.
Finally, we have seen that the level of information on governance practices and other “ESG” metrics attributable to such funds is still incipient, and it is certain that the CVM regulations and the Brazilian legislation applicable to rural properties, such as the Forestry Code, among other norms, already favor, and a lot, the conformity of the properties invested in by Fiagro Real Estate to the best environmental and compliance practices.
Thus, from this look we can project about the future of these funds, being certain that the definitive regulatory norm for their operationalization is under discussion and gestation by the regulatory authorities of the capital market, so that further ahead we will be able to talk about to fulfill our mission to inform.
Available at: https://www.moneytimes.com.br/fiagros-raio-x-historico-situacao-atual-e-o-futuro-do-ativo-no-mercado/
