Farming and food the next green bonanza: Wollemi Capital

Climate-focused investment firm Wollemi Capital is betting that agriculture and food are among the industries next in line to be transformed by lowering their carbon footprint, after raising $220 million in fresh capital.

Wollemi, co-founded by former senior Macquarie Group executive Tim Bishop, said on Monday it had finalised a Series A raising for the company, after demand to invest more than doubled the company’s initial target.

The raising – which included an equity investment from the Commonwealth Bank – comes as big investors such as super funds are keen to fund decarbonisation projects, eyeing off the potential long-term returns. Wollemi will use the funds to expand the company’s operations and to help fund its pipeline of green investments.

Bishop signalled the company was targeting projects where it believed it could make investments that banks would not be prepared to finance – and farming and food were high on its list of priorities.

‘Within the climate space, we believe there’s a rapidly emerging investment thesis that we find exciting around food, agriculture and natural capital.’

Tim Bishop, Macquarie Group executive

“Within the climate space, we believe there’s a rapidly emerging investment thesis that we find exciting around food, agriculture and natural capital, and some of the specific sleeves of the energy transition,” Bishop said.

“Part of the role that we are playing is to be a bridge to bankability. The investments that we are looking at might be too early for a bank, too early for an infrastructure fund, but they are in areas that our team knows exceptionally well, and we are comfortable with the risk profile because of the experience that we can bring to the table,” he said.

Global food and agriculture production (driven by human consumption) contributes 26 per cent to total global greenhouse gas emissions; about 80 per cent of the world’s agricultural land is dedicated to feeding livestock, not people. The meat and livestock industry, despite making headway to reduce emissions, contributes about 10 per cent of Australia’s greenhouse gases, two-thirds of which comes from methane, a natural emission as a result of a cow’s digestion system.

Bishop pointed to rapid changes in areas such as solar and wind, saying that in a decade they had moved from becoming relatively high-risk to mainstream asset classes.