The Future of Farmland
“Betting the Farm – and Winning”, an article I recently read in McLeans magazine, got me to thinking about the future of farming. Farmland is a “forever asset”, investors are buying it up and it’s making traditionalists nervous.
Investment of private equity in farmland has been ongoing for several years in the U.K., Ukraine, New Zealand and Australia. (In fact, the Alberta pension fund is reported to have purchased land in Australia that will be developed into a timber plantation and farm.) The governments of land-poor countries such as Saudi Arabia and Korea, as well as corporations and hedge funds, are buying huge swaths of farmland in South America, Southeast Asia and Africa, in what many call a land grab. A World Bank report on the issue described how farmers in the Democratic Republic of Congo, displaced after land was sold to a foreign buyer, had to pay guards at a national park to let them grow their crops there.
According to Wayne Caldwell, professor of rural planning and development at the University of Guelph, allowing private equity companies to purchase farmland can be problematic. “We have a legacy of farms being places where people live and make a living. It’s a romantic view, but it’s also a reality,” he said. “We’re in uncharted territory and we’re not sure what the implications will be.”
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