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Barings announces global agriculture launch

Barings Asset Management is to launch a soft-commodities fund under the management of Jonathan Blake.

The global agriculture fund is set for a third quarter launch as an onshore Oeic and will have a diversified portfolio of 90 to 135 holdings.

Blake currently manages the £769m Dublin-domiciled global resources unit trust for the group. A fund which currently has an exposure of 19 per cent to soft commodities. He took over management of the fund in 2006.

Blake says that with the world population growing at 80 million per year and consumption growing thanks to rising incomes, pressure on food prices is growing.

“Limited resources and bottlenecks mean that supply is struggling to keep pace with demand whilst global warming is likely to create additional pressure on supply in years to come.”

Despite offering a diversified portfolio, each stock will be equally weighted and will tap into opportunities in both the developed and emerging markets.

Investment opportunities range from chemical providers and farming infrastructure to retailers and distributors.

Blake says it also offers a hedge against inflation exposure.

“With the Bank of England predicting that UK inflation could rise towards 4 per cent this year, and with the US economy heading into recession, investors will be looking to review their exposure to these markets. By contrast, the long-term case for companies involved in agribusiness remains attractive in our view, and the sector is likely to provide valuable hedging benefits in an environment of rising inflation.”

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