Duxton Farms is an Australian listed entity providing investors with exposure to a diversified portfolio of high-quality, efficient, Australian farms

DBF NAV $2.69
Change   Fair Market NAV Per Share as at 30 June 2022

Duxton Farms Limited ("the Company") is an Australian listed entity (ASX:DBF) providing investors with exposure to a diversified portfolio of high-quality, efficient, Australian farms.

Access to a well-established portfolio of operating broadacre farms producing a diverse range of agricultural commodities.

Best in-class, on-farm management, strengthened by the global agricultural experience of the Investment Manager, Duxton Capital (Australia).

Risk is mitigated and returns optimised through mixed commodity production, long-term water security, and the strategic development of properties.

Duxton Farms continues to seek land-rich parcels for continued growth, scale, and diversification.

SQM Research rates Duxton Farms 4 stars high investment grade

Duxton Farms is an Australian listed entity providing investors with exposure to a diversified portfolio of high-quality, efficient, Australian farms. Australia presents a unique investment opportunity in this space because of the low-sovereign risk and potential for value uplift. To ultimately decide on Australia as the location for this Company, Duxton Capital Australia, being the Investment Manager, looked at some of the world’s largest wheat producers, who in aggregate, produce around 520 million tonnes of wheat each year.

Using various different measures of economic and sovereign risk, we narrowed the list down:

The USA

Canada

France

Germany

And Australia

Using Savills’s 2018 global farmland index data, we then analysed these and other countries, and compared them in terms of the capital cost of gaining farmland exposure in these countries. Let’s say you have $100 million US dollars to invest.

For this, you could buy…

9,799 hectares in America

4,286 hectares in New Zealand

3,533 hectares in Germany

4,150 hectares in the UK

and an incredible 43,403 hectares in Australia

Land in Australia is incredibly well priced, but is it comparatively productive? 

We assessed this by benchmarking the capital cost required, to purchase enough land, to produce the same 1 tonne of wheat, year-on-year.

To do this, it would cost you…

$3,305 US in America

$2,978 US in the UK

$3,595 US in Germany

$2,607 US in New Zealand

But only $1,329 US in Australia

You can see why we saw opportunity to farm in Australia given the low sovereign risk, and the mis-priced land. Now the next question is do higher operating margins outside Australia justify higher land values – the short answer according to a 5-year study conducted by the Grains Research and Development Corporation.

So, you have invested your $100 million US and bought land in these, each of which provides a different level of production. Your $100 million deployed into Australian farmland based on average production will produce approximately 85,000 tonne year-in, year-out.

In Germany, your $100m converts to 28 thousand tonnes. In New Zealand, your $100m converts to 38 thousand tonnes. In the UK and the US, your $100m converts to 33 and 31 thousand tonnes respectively.

Now using the data from the GRDC study we have multiplied this by local average farmgate prices per tonne, to calculate revenue per annum, and by average cost of production per tonne, to ultimately arrive at an annual operating profit. In Germany, your $100m should convert to approximately $2.1 million of annual operating profit. In America, its only $2.2 million. In the UK, it is about the same, at $2.5 million.

Whereas in Australia, you $100 million US dollar capital investment converts to a year-on-year operating profit of around $6.2 million, assuming average prices and costs.

The Company therefore recognises potential for capital growth in the underlying land assets of the aggregations. Based on historical data, we also believe grain prices are at the bottom of the cycle, sitting near all-time low inflation adjusted prices. There are a number of catalysts which are anticipated to provide strong upward pressure on the commodities produced by Duxton Farms and teamed with potential up-lift in local land values, this should result in stronger returns for investors over time.

Our Properties

Duxton Farms owns and operates a major geographic aggregation in NSW. The aggregation is located between Forbes and West Wyalong.

These properties are comprised of dryland and irrigated land, producing a diverse range of both summer and winter crops.

This Month on the Farm



Winter crop seeding has stopped for the season with the planting window for cereals having finished. Due to the wet weather conditions this season, significant areas remain unplanted, although, the operations team is looking to supplement the reduced winter crop plantings this season with alternatives such as safflower, which will depend on drier conditions. Areas which are under crop are progressing well, with the canola having begun flowering and the quality of the winter crop currently looking favourable. The majority of Duxton Farms’ cotton crop has been harvested, although as of August 2022, around 50 hectares remained unharvested due to wet conditions posing significant challenges for the harvesters with respect to access and maneuverability. Drier field conditions will be required before harvest can recommence.

Duxton Farms’ properties continued to experience wet conditions with heavy rainfall and overcast weather recorded across the aggregation over August. Central West New South Wales (Forbes Airport AWS) recorded 97.6mm of rainfall for the month, compared to the August long-term average of 36.3mm. Total rainfall during 2022 has so far been 54% higher than the 2007-2021 average, but still 20% lower than at the same time last year. Mean maximum temperatures over the month were 16.0°C, half a degree cooler than the long-term average for August.



The wet weather continues to support strong pasture development for Duxton Farms’ livestock programme. Sheep and cattle are being moved between the properties to take advantage of the favourable feed and field conditions. Adequate reserves of fodder continue to be maintained and will be utilised as required. Livestock sales are ongoing with strong prices received. Duxton Farms continues to trade livestock, purchasing as attractive pricing opportunities arise.