Wow! I didn't realize how long it's been since my last post!!!
A lot has happened in my life since then and I'm going to try to get it all down on "paper" soon, but in the meantime, I want to share some details about my next visit to Panama.
I'm headed back down to Panama and Paraguay the first ten days of May. The trip is partly to see friends but mainly to check up on some of my farmland investments and see how things are going. I can't wait.
I have a permanent residency visa and would have moved there by now but I met the most wonderful woman in the world and got married instead. It's turned out to be a pretty good tradeoff. 😊
While I’m in Panama City I also have an appointment with the American Consulate to get my Florida driver’s license validated, which is the first step toward getting a Panama license. Like everything in Panama, the bureaucratic nonsense for such a simple task is unbelievable… I even have to provide proof of my blood type to get a license!
That’s another whole story that I won’t go into now, so back to my farmland.
Simply Natural Farms
I first invested in Simply Natural in 2015. Over the years I have purchased multiple hectares of land to grow limes, mangos, plantains and avocados.
Unfortunately, the pandemic lock-downs have been especially hard on this company. Panama hyped COVID-19 as if it were the Black Plague. Unless designated as an essential worker, residents were allowed out of their houses a grand total of six hours per week; women could go out for two hours on Monday, Wednesday and Friday, and men could go out on Tuesday, Thursday and Saturday.
When I say “go out” I mean go to the store, doctor or pharmacy and the hour of day was determined by the last digit of your national ID card. That was pretty much it. They weren’t even allowed to walk their dogs.
It took weeks and weeks to get the government papers that would allow essential workers to drive to and from work. Even then, some provinces (including Coclé Province where the farm offices are) wouldn’t accept the national travel papers.
A great many Panamanians don’t own a vehicle and depend on buses and vans for transportation. Well, if you used to take a 16-passenger van to work, now they can only take four people at a time because of strict social distancing rules. Many farmworkers who were scheduled to begin their shift at 7:00 AM showed up at noon or later.
As time went on, many Panamanians were so freaked out that even essential workers like those working on farms just quit. The government and local agencies were providing food and they didn’t need to pay rent or utilities, so why take the risk?
As a result, crucial crop maintenance went undone. Rains that created mild flooding and under normal conditions required a couple of guys with shovels to divert the excess became major problems. Without this simple maintenance, the roots of mango trees remained submerged for weeks on end resulting in root rot and destructive fungus. I lost one hectare of mangos because of this.
None of this was Simply Natural’s fault but they stepped up anyway and decided to offer a swap of affected hectares for a new greenhouse project growing dragon fruit.
The upside to this is that those who were faced with replanting crops will be able to get a payout much earlier than waiting four to five years for new trees to grow. The downside is that the payouts aren’t quite as high and you no longer own the land, just the greenhouse and related systems.
When I visited last May (see Back to My Farms in Panama), the nine-month lockdown had been lifted and things had opened up quite a bit. I still had to wear a mask just walking down the street and going into a store required that I have my temperature taken and that I slather on hand sanitizer.
After spending two days on the various plantations, I believe the long-term outlook for Simply Natural is positive. Despite the lockdowns they managed to complete a major irrigation project, stage the piping for the next pumping complex, complete a number of greenhouses and resumed routine maintenance of the field crops.
At any rate, I’m anxious to see my hectares that weren’t impacted and to see the construction of the new dragon fruit greenhouses. By the time I get there, the excavation should be nearly completed along with some of the foundations and hopefully some of the structures will be started. The seedlings will be planted by year’s end and the first crops harvested in 2023.
This will be my sixth farm inspection tour since 2015 and I will be hosted by the President of Simply Natural as well as their Director of Client Relations.
Paraguay AG Invest
The greenhouse that my wife and I own in Paraguay should be fully implemented by the time I get there. The construction was delayed a bit by COVID-19 restrictions that impeded shipment of the structure and created a challenge for the workers, but overall Paraguay AG Invest has done an amazing job of getting the greenhouses built, irrigation and environmental systems installed and the first crops planted.
Paraguay instituted a six-week lockdown in 2020 in response to the pandemic but overall wasn’t nearly as draconian in their pandemic restrictions when compared to Panama.
The country has some of the lowest per capita spending on health in Latin America according to the World Health Organization. As a result, there were widespread protests in 2021 in response to a lack of vaccines, hospital beds and the overall medical response to COVID-19.
Despite these obstacles, Paraguay AG Invest managed to get their crops harvested, maintain the existing greenhouses and begin construction on new ones.
The Agri Terra Group, the parent company of Paraguay AG Invest, hasn’t been sitting on their hands during the pandemic, either. Not only have they moved forward with new projects, but they have also opened their own chain of produce stores and purchased an existing processing plant for packing, canning and juicing.
I really love this project and the company. Not only are the verified returns substantial (a 21.5% average annual return on investment) but the crops and structure are fully insured against fire and force majeure. My greenhouse will grow tomatoes, cucumbers, peppers and other produce, and uses an advanced drip irrigation system to conserve water and provide direct fertilization.
I’ll be in Asuncion for three days. In addition to inspecting their greenhouse project and orange groves, I’ll be meeting with the company president and get a briefing on their new strawberry greenhouses.
Follow-up
My company, Alternative Ag Investors, sells managed farmland and represents both Simply Natural and Paraguay AG Invest in addition to Teak Hardwoods.
I’ll give a full report when I get back in mid-May so that fellow investors can have the benefit of my analysis of both operations.
