Investors look to farmland to balance portfolios

[NashVegas]

Serf's up!

http://tennessean.com/business/archives/05/01/66549527.shtml?Element_ID=66549527

Investing in farmland is not a new trend, but it has attracted more buyers in recent years through listings on the Internet. Farmland is also advertised in magazines and newspapers and through mailings to prospective investors.

More than 40% of U.S. farmland is owned by people who don't actually work the land, and that has been the case since at least 1988, according to the U.S. Department of Agriculture.

Those selling their land have been getting good returns, too. Across the country, the value of land and buildings on farms has grown from an average of $599 an acre in 1987 to $1,360 an acre in 2004, a 52% increase when adjusting for inflation.

The highest percentage of absentee farm ownership occurs in the most fertile area of the country — the Midwest and into the Mississippi Delta — because it provides the best returns, said Lynn Henderson, president of publishing and economic forecasting company Doane Agricultural Services of St. Louis.

[no_hypocrisy]

1. Oh, great. Playing financial games with our food supply is the

equivalent of the stock market, residential real estate, and casinos. (Head shaking . . . .)

[Mr.Green93]

2. Farm land

should be a nationalized resource.

[doodadem]

11. A nationalized resource?

Farmland should be confiscated for the common good? That sounds like communism to me!
One thing that would really help the small farmer, is don't allow giant corporations like Boswell (here in CA) to carve up their vast holdings into smaller farms, so that they "qualify" for government farm subsidies. They take all the money, and the small family farmer gets next to nothing that way.
So what would people do if they couldn't "sell" their farmland? I have two different friends, also both horse people like me, who had to relocate. They both had their properties for sale for 2-3 years, and tried like hell to sell it to someone who would keep it as a farm, keep the wonderful old barns, and the grassy pastures. But economics and desperation finally prevailed. They both ended up selling to developers, who promptly leveled everything, and started seeing how many houses they could cram in per foot. Neither of these were huge tracts--30-50 acres, but prohibitively expensive for an individual to buy.
I see this all ending soon when the housing boom busts anyway.

[fasttense]

3. Wow, sounds like Ireland in the 18 hundreds.

The peasants worked the land and paid rent but didn't own it. The rich landowner took most of the crops in payment for rent and could kick the peasant off anytime they felt like it. The landowner chased the richest source of income. The absentee landlord switched to raising beef while thousand starved because the peasant couldn't afford beef. Our rush to emulate a Lord and peasant society is truly fascinating.

[jmcgowanjm]

4. Blck Farmers and the USDA-the Pigford Lawsuit

It is (sic) not strange that Black farmers are supposed to
have settled with the USDA for $2.4 billion and yet can't collect
it. It is interesting that, even though approximately $800
million has been paid out, the same culprits who
committed these grievous acts of racism and discrimination
are still employed at the USDA. The few who are not,
were allowed to retire with full benefits, while they had
destroyed livelihoods of Black farmers, families, and in
reality destroyed Black communities and strong bases
of political power across the
south.

http://www.coax.net/people/lwf/bfaa.htm

[Mari333]

5. Farmland has been bought up and developed

for a long time now..the USA of the small farmer is pretty much passe', with large corporate, unethical agri business taking over the food supply in the nation.
I drove through the Joliet Ill 1-80 corridor a while back and was shocked to see what used to be farmland stretching for miles was now full of ugly tract houses, and suburban sprawl (looking like the Chicago suburbs stretch from Chicago to Joliet and beyond)
Hey, people are having a tough time, so you sell what land you have to make some money to get by.
The small town where I live is selling off land outside of town, and its a nightmare. Developments are going up everywhere, and they are ruining the ambiance of small town living. Homes in town are being foreclosed on because no one can afford the new property taxes, and the developers from the big cities are buying them up at cheap prices..
the poor are moving wherever they can find a roof over their heads.
Middle class=new poor.

[bleedingheart]

6. I hate the overdevelopment of farming areas...

they move their for the ambience and then they destroy the very thing they moved there for...

[HereSince1628]

7. Is this really bad? & BTW some of the above ideas aren't Jeffersonian

This isn't flamebait against the concept of the family farm but rather a somewhat different perspective than that presented in some of the previous posts.

First about these numbers:

Farmers make up less than 2% of the population according to this report, they own something less than 60% of the arable land.

How is that a bad proportion for farmers, compared to the rest of our population?

Forgive me for not knowing the exact numbers but considering American assets in general something under 5% of the population holds more than 80% of all the wealth. That seems to indicate the vast majority of us have very very little control over the productive means of our labor. Their debt not withstanding, farmers would seem to be doing much much better than most of us in owning and controlling their means of production.

The freeman or yeoman farmer is an ancient tradition among English and Germanic people. It is also a strong tradition in the United States.

Consider that as a nation we lament at length the loss of family farms but we accept firings and bankruptcies of those who labor in the employ of others with few qualms. The failure of 100 family farms in a state is a tragedy, job-loss and foreclosure on the homes of 100 suburbanites is business as usual. This is true whether we are Democrats, Republicans or Libertarians.

Our sentimentality of freeman farms is a huge cultural endowment that may make us less than rational about this topic.

We need to be careful about letting emotion guide us too much.

Jefferson was an advocate of the application of Saxon laws that supported the concept of freeman landholders. During his work on the Virginia constitution and the Ordinances of the 1780's he apparently pressed his fellows in arguments favoring the establishment of a agrarian economy including yeoman farmers. He opposed the concept of heritable transfer of property through primogeniture (first borne) and the nation's (kingdom's) holding of the land which was a practice forced onto England by the Norman conquerors.

Nationalization of land is distinctly NOT a Jeffersonian concept. As Jefferson represents one of the principal founders of the Democratic Party, before we start promoting such a thing, we should consider carefully our party's philosophical roots.

However, it is interesting to note that as Hitler laid out the agenda of the Nazi party in about 20 talking points in the early 1920's, it included a proposed ban on the selling of farmland.

[BeFree]

10. Yes, it is bad

You have the wealthy investment class controlling the means of food production. The accumulation of productive lands by a few wealthy is really nationalization in a fascist sense. In that context, the wealthy are the nation.

The problem with massive accumulations of land is that such gatherings pose huge management problems, and centrally controlled politics is the name of that game. OTOH, Independent small farmers manage their lands to the best of their natural abilities with diversity and decentralized control the name of their game.

The long range worse case scenario is one that implies political failure leading to food shortages due to political mismanagement. Such a scenario can only be remedied by ensuring individuals are the sole managers of their own individual farms.

[HereSince1628]

12. I appreciate the anxiety of corporate oligarchy controlling agriculture

But control of the food isn't as simple as control of farm
production.

The availability of food at reasonable prices is also about processing, distribution and marketing. Those areas are already under virtually complete corporate control...some aspects of the food industry have already reached oligarchical control.

My point is to look at the statistics from an altogether different perspective.

Farmers may not be doing exceptionally well financially, and further development of oligarchical control of production isn't a good thing,

Nonetheless the numbers presented in the article suggest that across the last century farmers have done better in maintaining control/ownership of their labor than the vast majority of Americans.

[BeFree]

13. Yep

At present the control of the other facets of food production are in few hands. The only thing keeping them honest is the individaul farmers who manage their own farms as they see fit.

Once the lands are owned by the corporations too, they can run hog-wild and in so doing, my contention is that the ensuing mismanagemnt will lead to shortages.

The idea was that lands need to be nationalized to protect those lands from corporate management. I contend they alredy are to a large degree and at this point our support of the base operators of food production is the only thing we can do to save our food supply.

If, as you read the numbers, farmers do have a level of control above and beyond most Americans, then that is good news.

[MARALE]

14. As a farm child and future land owner

I think it is good that the land is owned and rented out. You see, the big corperations here want to buy the land, but the farmers are older and want to hand the land down to their family. They can say what is happening on the land and most older farmers do not like all the fertillizer and tilling that big corperate farmers do. If they own the land, they do have a right to say what is put on the land. They big corperations don't care about the future of the land like the small farmers do. I do not plan on selling the land because of this, even though it would be easier and I would get a lot of money for the sell. That is why a lot of the farm land is rented out, not because the big corperations own the fields, but because the small farmers do and are renting them out.

[BeFree]

16. The Future?

It looks like the recent transportation of produce from fields around the world will decrease with the advent of peak oil.

The lands closest to market will become more and more profitable as the hydro-carbon avenues on which produce now flows are throttled.

Keeping farm lands from an over-arching control is paramount to America's future. Whatever it takes, eh?

[MARALE]

18. We are planning on farming some of it

We are going to start natural and organic farming in a few years. Mainly raising cattle since a lot of big corperations don't get into raising cattle. I think many of the older farmers would sell to smaller farmers if given the chance.

I do think the price of fuel will drive many small farmers out of the crop business and more specaility farms will show up. Many farmers are starting to farm together, sharing equiptment, because everything is so expensive. Add the cost of the fuel, food prices being so competitive, and the government not paying on their supplimental programs to everything and there are going to be many changes to food in the future.

[doodadem]

19. "Where the Critters Roam", A recent article in the Fresno Bee

Half page on the front, "Where the Critters Roam", complete with color photos, covered an older farmer with 2,900 acres close to Yosemite National Park, who has sold any future development rights for his farm to the Sierra Foothill Conservancy for $1.4M, supplied by the Calif. State Wildlife Conservation Board. WHAT A CONCEPT! He said he knows he could get a ton of money for it from developers, but "the ranch is better the way it is". And it will be kept as a wildlife easement. If you go to fresnobee.com, it's the issue dated 2/24.
I wish the Conservancy would be interested in my little 40 acres for something like that. We have our own little wildlife sanctuary here, with mule deer, bobcats, hawks, coyotes, etc., but it's not big enough to interest folks like this I'm sure. Still, a big farmer taking a stand like this is phenomenal.

[Charles19]

8. People should not be allowed to buy farmland own it

and have someone else work it and not get any of the benefits.

It should be the person can buy farmland, have someone else work the land, and then split profits 50% with the person working the land.

There are very important micro and macro reasons for this.

[jmcgowanjm]

20. This would make you a LaFollette Populist

That article reminds me of a great Bob LaFollete quote from
his 1924 campaign for president, where he garnered 17% of
the vote nationally, the best of any progressive third party
in American history-

"The underlying reason indeed why both parties have failed
to take the people's side in the present crisis is that neither
party can openly attack the real evils which are
undermining representative government without
convicting themselves of treachery to the voters during
their recent tenure in office.

In the 1800s, the only post-Civil War Democratic
administrations, those of Grover Cleveland, were not
much different from the Republicans in their hard
money economic policies that were killing the agrarian
economy.

http://www.blogforamerica.com/archives/004707.html

For the people in diverse (and conflicting) sectors in
Bolivia, there are serious issues on the table: how to
meet human needs for water and gas, autonomy and what
it might mean for different regions of the country, an
overdue Constituent Assembly to remake a government to
be closer to the people…

http://narcosphere.narconews.com/story/2005/3/8/145848/7460

Right now, USans are just too satisfied or afraid (too
much to lose). But w/ oil getting more expensive by
the week, there will be change.

[jmcgowanjm]

9. Why the interest in farming today?

2 threads right at the top of DU.

I come from a farm family.

Been thru it all. In the Miss Delta.
More accurately, the Arkansas River Delta.

Until the demand for oil outstrips supply,
sometime later this year, consolidation, land
clearing will continue.

Only when human labor, livestock, are more valued
will the picture change.

[NashVegas]

15. Can't Speak For Anyone Else, But

For my own part, the interest stems from what I call "The New Medievalism." Gated communities, Doug Feith & Co. getting Iraq contracts for their friends (fiefs). And land-owning farmers more and more becoming tenant farmers. At least the real medieval serfs were offered some protection from marauders and charity by their landlords. Here, now, it looks as if the owners are the marauders: these landlord investors have no ties to the land they're purchasing. When they decide to sell, what concerns will be in their minds regarding the land and its inhabitants?

[jmcgowanjm]

21. The danger to absentee landlords is always their tenuous access

to the land.

As my Grandfather said, "To be a good farmer
you should touch every corner of your land
everyday."

My Theory-if you actively work the
land it will eventually be yours.

Speaking of the Miss Delta, there is a large
contingent of Italian farmers there, who came
to America in the 20's as tenants, sharecroppers
and are now large landowners.

Cheers, Crisco, and thanx for the farm articles.

To find out what the Delta Regions farmers
are doing you can go here:

Budget proposals ‘unfairly target Sunbelt,’ NCC chairman
says
Mar 8, 2005 10:17 AM

http://deltafarmpress.com/news/050308-eastland-budget/

[leQ]

17. land in north iowa is goin for over $3500/acre....

and now i know why.