Food Inflation Research Predicts Inflation Will Reach Highest Level In 12 Years In 2022
A recently released Dalhousie University study (“Canada’s Food Price Report 12th Edition 2022”) predicts that the 2022 annual food expense for the average Canadian family will increase ~7% ($966) to $14,767. This increase would be the highest increase in 12 years in both absolute dollar and percent terms.
Veripath Farmland Partners (“Veripath”) managing partner Stephen Johnston responded to the study noting that: “Food price inflation is one of the most pernicious and corrosive elements in widespread inflation due to the inelastic nature of demand for food and the disproportionate impact food price inflation has on low income households and economies. Remember the wisdom of Milton Friedman, the Nobel Prize winning economist, when you are trying to sift through all the explanations and excuses for how this inflation seemed to suddenly appear out of nowhere: ‘inflation is always and everywhere a monetary phenomenon’.”
Who is Veripath: Veripath is a Canadian alternative investment firm. Members of Veripath’s management team have decades of farmland, private equity, and private credit investment experience. Veripath currently manages approximately 90,000 acres of Canadian farmland across its active portfolios. Fact sheets can be found here – www.veripathfarmland.com/investors. Veripath believes that there are a number of factors that are supportive of the Canadian farmland investment premise, a few of which are highlighted below.
• Value: Canada has some of the most competitively priced farmland in the developed world – particularly on a productivity adjusted pricing basis.
• Diversification: Farmland exhibits low correlation to traditional stock/bond investments so can improve portfolio risk diversification.
• ESG: Western Canadian zero-till portfolios capture material amounts of carbon.
• Inflation Hedging: Farmland has historically had strong inflation/stagflation hedging capabilities and outperformed in real terms during periods of low real rates/high inflation.
• Demand: Farmland is a non-volatile way to capture the anticipated incremental demand coming from population growth and growing demands for food, feed, fuel and water globally.
• Veripath divides the Canadian market into two separate geographies of ~84M acres each in order to streamline and simplify farmland ownership regulatory compliance. Veripath Farmland (UR) LP invests in all of Canada (excluding SK and MB) and Veripath Farmland LP invests just in SK and MB. The two sister Funds have the same terms and fee structures.
Disclaimer: This document is for information only and is not intended to provide the basis of any credit or other evaluation, and does not constitute, nor should it be construed as, an offer to sell or a solicitation to buy securities of Veripath, the Funds or any other entity, nor shall any part of this document form the basis of, or be relied on in connection with, any contract or investment decision in relation to any securities. No reliance should be placed on the completeness of the information contained in this document. This document is not intended to be a comprehensive review of all matters concerning Veripath. Prospective purchasers of this investment opportunity may be provided with formal offering documents and will need to be qualified for investment prior to making any investment. No person has been authorised to give any information or to make any representation not contained in such formal offering documents. No securities regulatory authority or regulator has assessed the merits of the proposed offering or reviewed any of the offering documents. This investment opportunity is speculative and involves a high degree of risk. There is a risk that any investment made will be lost entirely or in part. Only prospective investors who do not require immediate liquidity of their investment and who can afford the loss of their entire investment should consider this investment. Veripath Farmland LP and Veripath Farmland (UR) LP has retained Qwest Investment Fund Management Ltd. to provide certain of its services, including oversight and approval of net asset value (NAV) calculations, subscription and redemption processes, as well as access to Fundserv Inc.’s platform.
This document may contain forward-looking information and statements (collectively, “forward-looking information“) within the meaning of applicable securities laws. Forward-looking information is provided for the purpose of providing information about the current expectations and plans of management of Veripath relating to the future. Readers are cautioned that such information may not be appropriate for other purposes. All statements other than statements of historical fact may be forward-looking information. More particularly and without limitation, this document contains forward-looking information relating to Veripath’s investment objectives and strategies and its expectations with respect to the benefits of investing in Canadian farmland. Forward-looking information is based upon a number of assumptions and involves a number of known and unknown risks and uncertainties, many of which are beyond Veripath’s control, which would cause actual results or events to differ materially from those that are disclosed in or implied by such forward-looking information. Although management believes that expectations reflected in such forward-looking information are reasonable, undue reliance should not be placed on forward-looking information since no assurance can be given that such information will prove to be accurate. Veripath does not undertake any obligation to publicly update or revise any forward-looking statements except as required by applicable securities laws.
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