Canada’s Public Sector Pension Investment (PSP) Board is continuing to add New Zealand dairy assets to its portfolio.

New Zealand’s Overseas Investment Office (OIO) has given its approval for the board’s purchase of a 918 hectare dairy farm in Maniototo through its wholly owned subsidiary, Appleton Dairy Farm Ltd. The purchase price was withheld under the Official Information Act.

Under the conditions of the approval, the OIO states that the buyer is required to set aside 160 hectares of wetland in the Maniototo and Styx Basins called the Taieri Scroll Plain, which is described as being “the only one of its kind in New Zealand,” reports NZFarmer.

The PSP board reassured the OIO that it intended to continue dairy farming at the Maniototo farm with day to day operations being overseen by management company, FarmRight. There are also planned “significant” investments in the pipeline to increase the site’s milking platform through improvements to the farm’s irrigation infrastructure and the expansion of its herd size.

With approximately C$116.8 billion of assets, the PSP is one of Canada’s largest institutional pension funds, investing on behalf of the country’s public services, armed services, and mounted police. Of its approximate C$1.5 billion invested in natural resources, 83% is invested in timberland and 17% is invested in agriculture.

In the last quarter of 2015 the PSP board was given approval by New Zealand’s OIO for the purchase of a 280 hectare dairy farm in North Canterbury, after the transaction was found to meet the requirements of being a substantial and identifiable benefit to New Zealand through an increase in production, the creation of jobs, and an increase in exports.

In November of 2014, PSP was granted approval from the New Zealand’s OIO for the purchase of a portfolio of 18 commercial and retail properties from AMP Capital Investors, making Canada surpass China as the top source of overseas investment in New Zealand between January 2013 and December 2014, according to a KPMG survey called Foreign Direct Investment in New Zealand: Trends and Insights based on two years of OIO data. The KPMG survey found Canada accounted for 22% of total overseas investment in New Zealand in 2013-14, with China accounting for 14%, the U.S. accounting for 13%, and Australia accounting for 11%.

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Lynda Kiernan