Cargill may have broken law over Colombia land buying: Oxfam

Fri Sep 27, 2013 5:02am EDT
 
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By Peter Murphy

BOGOTA (Reuters) - U.S. commodities trader Cargill CARG.UL bought a large area of farming land in Colombia many times bigger than the legal limit by setting up dozens of "shell companies", violating the spirit of agrarian reform laws, charity Oxfam said in a report Friday.

In the research report "Divide and Purchase," Oxfam says Cargill set up the companies to buy land up to the legal limit for any individual or company, to farm all of the adjoining land as a single plantation and get around restrictions designed to promote distribution of land to smallholder farmers.

Oxfam says that Cargill's purchase of at least 52,576 hectares (130,000 acres) in the eastern Altillanura plains through companies registered from 2010 and 2012, all listing the same agricultural activity and address, may have broken the law.

"The company violated the spirit of the law by accumulating an area at least 30 times greater than the permitted limit," Oxfam said in its report which also listed other lesser known local and foreign companies it said also circumvented land laws.

Cargill spokeswoman Lori Johnson told Reuters the land in question was "not suitable for growing crops on any scale without significant investment," for example to correct acidic soils and build infrastructure to transport crops.

"Where we disagree with Oxfam is on what are the policies that really lead to stability, poverty reduction and increased food security. And, in this particular instance we clearly disagree with their interpretation of the law," Johnson said.

Colombia has one of the highest rates of land concentration in the world, Oxfam says, with 80 percent of the land owned by 14 percent of landowners. Legal limits on land purchases including in the Altillanura plains, are a key part of Colombia's land-reform effort.

Individuals and companies are only able to buy much smaller areas of land between 36 and 1,725 hectares (89 and 4,262 acres) in the region, Oxfam said.   Continued...

 
A logo is pictured on the building of Cargill International SA in Geneva August 4, 2009. REUTERS/Denis Balibouse