Natural resources fundraising overcomes commodity rout

CoalCapital raised by natural resources funds is on course to match the $61 billion (€57.3 billion) raised by these funds in 2013.

Last year saw a dip in funding, when funds raised $52 billion, but that figure has already been surpassed this year, according to Preqin, a data provider.

The firm says that natural resource funds are following the broader trend of alternative assets, which is to see capital concentrated in a smaller number of funds.

So far in 2015, only 45 funds have reached a final close – down from 111 in 2013.

Energy-focused funds dominate the fundraising in the natural resources sector, accounting for 71% of the class. Agriculture funds make up 20% while timber funds account for 4%.

Given the global commodities rout, metals and mining funds have struggled as investors remain cautious. So far this year only one such fund has successfully closed, raising $400,000. It is the third consecutive year of decline from a record $4.6 billion raised in 2012.

“2015 has been a challenging year for the wider natural resources industry, with low commodity prices grabbing the headlines. Despite this, new natural resources funds continue to come to market and successfully raise capital with 2015 marking the latest in several years of strong fundraising,” says Tom Carr, head of natural resources products at Preqin.

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