A report commissioned by the Australian government found that foreigners are heavily investing in the country's agricultural companies such as those into sugar, grain and beef production. South Australian Senator Nick Xenophon warned of the impact of control of such foreign capital into Australia's food security.

Reports said that government officials are crafting a plan to ensure that foreign investments in the country's prime farming assets are more transparent.

In June, a $610-million takeover by Spanish investors of SunRice, Australia's major rice producer, almost pushed through. Chinese and other offshore investors have also purchased into the meat processing and wheat sectors.

The Australian Bureau of Agricultural and Resource Economics, which commissioned the report, is expected to make this month an announcement on plans to make foreign investments in the agri sector more transparent. The report would include the figures on how much of Australia's farming sector is now owned by foreign investors.

On the average, overseas investors plunked in $2.5 billion yearly over the past three years.

A senate probe will likely conclude that the country's control over its food supply could be weakened unless amendments are introduced to Australia's foreign investment guidelines.

Mr Xenophon said Australia could not blame foreigners for snapping up shares in agri companies because of the country's open-door policy which allows foreign investment of up to $231 million. In contrast, purchase of more than 5 hectares of land would lead to government intervention in New Zealand.

"We are being mugs if we don't change the rules. We have this open slather approach to foreign investment of our prime agricultural lands that makes us an international laughing stock," Mr Xenophon said in a statement.

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