Agri majors to boost farm investment in poor nations

By Svetlana Kovalyova

MILAN (Reuters) - Major world food and agriculture companies pledged on Friday to pour more funds into farming in poor countries to boost food security but they stopped short of proposing precise sums.

The world needs to invest $83 billion a year in agriculture in developing countries to stamp out hunger and feed a projected population of 9.1 billion by 2050, up from 6.8 billion now, the United Nations' Food and Agriculture Organisation (FAO) says.

Seeking to drum up private sector support, FAO brought together leading food and agribusiness companies -- including Nestle, Unilever and Cargill, for a two-day meeting in Milan, ahead of a summit on food security in Rome next week.

"We stand ready to invest meaningfully to help build national capacities in applied agriculture and food systems research and technology transfer in developing countries," business leaders said a final declaration after the forum.

"We also recognise and embrace the need to take a longer term view of investment and business operations in developing regions, since the global challenge of food security requires sustained commitment," they said.

Business leaders said their existing multi-million dollar investments in sustainable agriculture in developing countries were part of strategies to boost reliable long-term supplies and reduce costs as well as setting the stage for expansion in new markets.

Last year's food price spikes were a wake-up call for food companies and, with price volatility expected to remain high, major firms have stepped up investments in farming to ensure they do not get caught off guard again.

FAO says foreign direct investment (FDI) in farming tripled to over $3 billion between 2001 and 2007 but that still was less than one percent of total world FDI inflows.