Natural Resources Funds Have Record Quarter
Updated: Sep 9, 2022
Globally, natural resource fund managers have secured $57 billion from 24 funds, the most successful first quarter on record of any year for the asset class in terms of aggregate capital raised, says Preqin in its ‘Q1 2022 Natural Resources Report.’ While the number of funds closed remains on the lower side at 24, it does indicate the growing size of funds among successful fundraises. Net cash flows reached positive $2.9 billion. The data from the first quarter shows this is the first-time natural resources net cash flows have surpassed the zero threshold. This means that more capital is being distributed back to investors than called up by fund managers for investment. This is likely the result of the third quarter of 2021 being one of the weakest quarters for fundraising, leading to less capital called. Meanwhile, commodity prices and asset valuations remain elevated, meaning there is strong appetite for natural resource investments.