Yes, Chinese companies have financial interests in the overall food supply in the United States. But their ownership of American farmland is dramatically overstated by politicians, according to a new research report.
These three researchers led the study:
“Mapping and Contextualizing Foreign Ownership and Leasing of U.S. Farmland” pushes back on political assertions that Chinese companies are acquiring vast amounts of farmland and threatening U.S. food production and supplies.
The report’s authors wrote, “Recently, public concern around this issue has been escalating due to the increasing foreign interests in U.S. farmland during the past two decades and the growing attention of public media and politicians on ‘adversary countries.’”
The report acknowledges that foreign interests in American farmland have increased this century. But it provides context about the nature of those interests.
The authors wrote, “Our investigation reveals that over the past two decades, while foreign interests in U.S. agricultural land have demonstrated a steady increase, a significant portion of the recently acquired farmland by foreign entities is held under long-term leases rather than in full ownership.”
Those long-term leases, the report found, often focus on energy production rather than food.
“Furthermore, our findings indicate that the primary acquirers of agricultural land are energy development and natural resource entities, as opposed to entities primarily engaged in agricultural or food production. This distinction holds particularly true for those entities holding long-term leases.”
The report cites “the emergence of wind and solar energy farms” and called it “a notable trend of the recent foreign investment in U.S. agricultural land.”
However, the authors concluded that those foreign investments have limited impact on the area of greatest concern: food production. “…their effect on the U.S. food supply chain is likely limited,” the authors wrote.
State legislatures and members of Congress have prioritized efforts to restrict foreign investment, particularly China, of American farmland over the past several years.
RELATED: Harrison Pittman, director of The National Agricultural Law Center at the University of Arkansas at Little Rock, studies legislative efforts to restrict foreign ownership of American farmland. Watch his interview with American Farmland Owner here.
“Foreign ownership of U.S. farmland has been a concern among rural communities for a long time,” the study’s authors wrote. “While there is no outright ban on foreign land ownership at the federal level, the Agricultural Foreign Investment Disclosure Act (AFIDA) of 1978 requires foreign investors who acquire, transfer, or hold an interest in U.S. agricultural land, including leasehold interests of 10 years or more, report such holdings and transactions to the Secretary of Agriculture on Form FSA-153.”
The authors sum up several other studies that laid out concerns that some have about foreign farmland ownership:
- Entry cost to potential farmers
- Increasing absentee ownership
- Disruption of the traditional union between farm ownership and operation
- Economic well-being of rural communities
But some of those concerns could be emotionally driven rather than economic. “There has also been an ongoing debate about whether the increasing farmland price should be attributed to the foreign purchases of U.S. farmland, but there is no common agreement toward the potential effect as little study has directly addressed this issue,” the report stated.
Article courtesy of : American Farmland Owner
