October 11, 2024

Merricks Capital Agriculture Credit Fund Portfolio and Market Update – September 2024

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The Merricks Capital Agriculture Credit Fund (the Fund) returned 0.8%* in September and 10.3%* on an annualised basis since inception.

During the month, a 3.6% allocation ($13.5m) to a grazing loan’s exit strategy progressed with an executed contract of sale for the secured assets. The sale is expected to facilitate full repayment of the facility, timing of settlement is expected in October 2024.

The outlook for rainfall over the next three months to year end is positive, with BOM predicting average rainfall across the eastern seaboard and above average rainfall on the western seaboard. The Fund’s $7.4m allocation to a meat & livestock loan situated in Western Australia has benefited from the recent rainfall. FY24 summer and autumn rainfall in the local region was 41% down compared to the historic mean. Climatic conditions improved during winter, with seasonal rainfall 28% above the historic mean and positive to the borrower-led property sale process that is expected to repay the facility.

We are actively focused on increasing our exposure to mixed-farming, horticulture and downstream supply chain sectors, which are positioned to deliver strong risk-adjusted returns. Two new horticultural loans entered due diligence during the month while a strong pipeline of opportunities has been evident in the meat & livestock and dairy sub-sectors.

*These returns are stated net of fees and costs

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