The Selling of America: The Dramatic Increase of Foreign Owned Farm Lands

This land is your land, this land is my land
From California, to the New York island
From the redwood forest, to the gulf stream waters
This land was made for you and me
                             — Woodie Guthrie

According to a recent article in US News, May 28, 2019, nearly 30 million acres of U.S. farm land is now owned by foreign countries.  These are quietly emerging facts disturbing to many Americans, particularly small and medium sized farmers.

Many states have no regulations to stop foreign countries from buying American farm lands.  For example, Ohio and Texas have no restrictions, and approximately half a million  acres of prime farmland have sold to foreign owned entities. In Ohio, this, in part,  translates to 64,000 acres owned by companies from the Netherlands.  The Midwest Center for Investigative Reporting Tool (http://apps.investigatemidwest.org/afida/) provides information by state, county and name regarding foreign owned lands.  For example, Canada is top owner of American farm lands at 6.87 million acres, the Netherlands following at 4.87 million acres, Germany with 1.94 million acres, the United Kingdom at 1.7 million acres, Italy with 1.4 million acres and France with 1.04 million acres.  And the number is increasing.  In 1998, approximately 10 million acres of American farm land were foreign owned, compared to 27.3 million acres in 2014.  In summary, 54.9 percent of American land under foreign ownership is forestland, 23.6 percent pastureland, and 21.5 percent cropland.

There are many reasons why foreign entities buy American lands.  Reasons vary by investor.  In northwest Ohio, for example, the Netherlands purchased 64,000 acres for the development of wind farms. Their reason is cold hard cash. According to Stephen Raes, economic minister for the Netherlands embassy in Washington D.C., the Dutch nationalized pension is 130 percent the size of the nations’ gross domestic product.  In other words, profits from farmland investments go directly to support the pensions of that country.

In 2013, the Chinese purchased Smithfield Foods, a meat processing company, and immediately gained over 146,000 acres of American farmland.  The goal of China’s communist party authorities suggest specific strategies to invest in agriculture overseas is to gain greater control over oilseed and grain products, to create policies to support facilities, equipment and inputs for agricultural production, and to create large multinational grain-trading conglomerates.  The revenues from these productions do not pass through the American commodities markets, but rather, flow through the foreign entities’ own distribution channels, directly to the home country.  As these conglomerates grow, and with the purchase of more American farm lands, China may not need to negotiate trade policy with future administrations, as they will own their own agricultural conglomerates and distribution channels.  This is precisely how the Japanese car market penetrated the American automobile market in years past, buying up American distribution channels as a means of moving their vehicles through the American economy.

As small and medium farmers struggle to hold on to their farm lands, they are an easy target for foreign investors. It will behoove state governments to begin evaluating their state regulations regarding the purchase of foreign purchased agricultural lands.  By example, Iowa allows no foreign ownership of agricultural lands in their state.  It will also benefit states to consider measures to support the small and medium sized farmer, rather than giving way to corporate farm organizations, who hold profit above the spirit of farming and land conservation.  Surely,  there are bi-partisan measures that can be undertaken to support an industry that is the food source for our country.  

So what can be done?  One important measure is to create an agricultural policy ‘think tank’ with the small to medium sized farmer squarely in focus to undertake long term planning for agriculture in the State of Michigan.  Just as we do city and county planning and zoning, we should consider agricultural planning to assure the growth and survival for the smaller farmers in this country.

Another is to consider a concept similar to lobbyists so prevalent in governmental structure.  The American small farmer is not necessarily a good salesperson for himself/herself, and our government does not appear to understand the science or the marketing of agriculture.  It would be similar to selling a complex pharmaceutical product with no product knowledge.  How do we expect our elected officials to negotiate good trade deals with limited knowledge of the agricultural community?  Better communication is needed from farm to government, to ‘sell’ the importance of an agricultural economy to our country’s leaders.

— Deborah J. Comstock
Adrian

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