By Colin Packham
SYDNEY, Sept 7 (Reuters) - A new Australian farm registry reveals nearly 15 percent of rural land is foreign owned, with British investors dominating and Chinese a distant fifth, allaying popular fears that Chinese rural investment may threaten food security.
Ownership of farmland, especially by Chinese investors, is a sensitive issue in Australia, one of the world's biggest agricultural exporters, as foreign buyers snap up properties to cash in on a boom in Asian food demand.
Australia blocked the proposed sale of the country's biggest agricultural land holding, S. Kidman Co, to Chinese bidders in April, saying it was not in the national interest. is a perception that the industry is swamped by Chinese or Asian investment, and this report proves that this isn't the case," said Tony Mahar, chief executive officer of the largest rural industry body, the National Federation of Farmers.
"There is a feeling that all foreign investment is bad but we need to start telling the story about what the benefits have been," said Mahar.
China has warned Australia against "protectionist" policies after it also blocked a A$10 billion ($7.57 billion) sale of the country's biggest energy grid in August to Chinese bidders, after they failed to overcome security concerns. President Xi Jinping raised the issue with Australian Prime Minister Malcolm Turnbull on the sidelines of a G20 summit on Sunday, calling on Australia to provide a fair and transparent environment for foreign investors.
According to the Australian Tax Office (ATO) farm registry 13.6 percent of rural land was owned by offshore investors, ahead of the previous estimate of 10 percent, but shy of fears that the figure could have exceeded more than 20 percent.
British investors were the largest foreign group accounting for more than half of all offshore ownership, followed by the United States. Chinese investors came in fifth, owning less than 3 percent of rural land.
If a Chinese-led bid for S. Kidman and its agricultural land ultimately proceeds China will be elevated to second largest foreign landowner.
But the new farm registry will not completely quell the debate over foreign landownership.
Australian Deputy Prime Minister Barnaby Joyce, a leading proponent of tighter control of foreign acquisitions, said the registry proved the decision to block the Kidman sale was correct.
"There is more than two times the size of Victoria (state) is now fully foreign owned or partially foreign owned. I'm not saying there is anything wrong with that, but this is a substantial amount of land, said Joyce. ($1 = 1.3046 Australian dollars)