Agriculture, inviting but difficult for investors

Agriculture, as an important but less developed industry, has been gaining increasingly more attention from investors, but investing in this industry has unique risks, said some attendees of the CKGSB MBA World Economic Forum 2012.

Su Chuang, vice president of the Gold Stone Investment, a direct investment arm of CITIC Securities, said China's agriculture has ushered in the “golden ten years” for development as it transfers from an ancient industry to a modern one. He added that the industry is worth investing in but emphasized some unique risks.

One risk for investing in agriculture lies in its measurability as agricultural produce are hard to measure for auditors and trade with farmers is by cash, said Su.

He added that the high volatility of the industry, which relies a lot on nature, also poses risks.

In addition to high risks for investors, a lack of skilled professionals also deters the industry's development.

Tang Xun, executive director of Hosen Investment, said agriculture is an industry that attracts fewer talented people as many agricultural companies are not able to pay the high salaries desired by these people.

Tang said the agriculture industry can be a good choice for MBA students as talent in other industries are oversupplied.

Henry Cai, chairman of Asia Corporate Finance and Head of China Corporate and Investment Bank at Deutsche Bank, said there is 30 percent more skilled workers going to the investment bank sector than actually needed.

The CKGSB MBA World Economic Forum 2012 was held in Beijing on Nov 20 to 21 by MBA students admitted this year to the Cheung Kong Graduate School of Business.