Say "food stock" and you might immediately think of a brand, like Heinz, or a big grocery chain.

On Wall Street these days, food stock is starting to mean land itself. Private equity and hedge funds are scrambling to buy farmland ahead of rapidly escalating global food demand.

Also popular now are companies that make fertilizer, grain elevators, and food-shipping equipment.

“The equity markets have not fully come to grips with the enormity of this increased demand, but investment funds are beginning to comprehend it, and the money flow toward farms has begun,” economist Glen Langan told BloggingStocks.

Calyx Agro — a division of Louis Dreyfus Commodities — is buying tens of thousands of acres of cropland in Brazil with the backing of large institutional investors, like AIG Investments.

Private equity fund BlackRock is buying farmland acreage in parts of the world as diverse as Africa and England. Emergent Asset Management is raising up to $750 million to buy small plots of farmland it plans to aggregate in sub-Saharan Africa.

The Ospraie Special Opportunities Fund is buying 66 grain elevators with a total capacity of 110 million bushels from ConAgra for $2.1 billion. The deal, expected to close by the end of June, also will give Ospraie a stake in 57 fertilizer distribution centers and the barges and ships necessary to keep them supplied with low-cost imports.

Unlike the grains grown on it, new supplies of land cannot be created. Owning crop-producing land frees investors from regulations that curb the number of speculative bets they can make in commodity markets.

“China and India combined could add about 3 to 5 million members to the world's middle class each year over the next decade,” Langan points out.

“Those are consumers with money to spend, and they'll consume more food. And that total does not include expanding middle classes in South America, Eastern Europe, and the Middle East.”

Grain elevators on agricultural land provide another way to increase investment returns by allowing land-owning investors to store harvests and manage grain sales themselves.

“There is a considerable interest in what we call ‘owning structure’ wherever the profit picture is improving,” Cole Partners Asset Management president Brad Cole told The New York Times.

Not everyone feels entirely positive about these new agricultural investments, however.

“It’s important to ask whether these financial investors want to actually operate the means of production, or simply want to have a direct link into the physical supply of commodities and thereby reduce the risk of their speculation,” says fund adviser Mark Lapolla.

Lapolla notes that when crop prices are climbing, for instance, holding back inventory for future sale can yield higher profits than selling to meet current demand. When prices differ widely in different parts of the world, too, inventory can be shipped to the more profitable market.

The risk, of course, is inflated prices and increasingly hungry poor.

Fund executives say such fears are unfounded, claiming their farmland investments will encourage increased production of the grains the world so desperately needs.

“What this new investment will buy is more technology,” says Axel Hinsch, CEO of Calyx Agro.

“We will be helping to accelerate the development of infrastructure, and the consumer will benefit because there will be more supply.”