Touch the Soil News #2062 (photo – U.S. Farmland – Courtesy of the USDA, Public Domain)
While farmer’s farm, and people in other occupations work, it is inevitable that millions of people are working to build investments for retirement. Every month, billions of dollars that were circulating through wages, are taken out of that loop and put into retirement investments. As these pools of investment dollars grow, these dollars now have a different mission – how to get return on investment.
It comes as no surprise then that millions of investment dollars are now looking for good farmland to invest in. The challenge to farmers then becomes one of competing with farmers for farmland.
One of the more successful companies in owning and managing farmland is Farmland Partners (https://www.farmlandpartners.com/). In the reverse, there services that companies like Farmland Partners provide. If a grower is in need of liquidity and must sell a parcel of land, Farmland will buy the land and then lease it back to the farmer.
In the larger picture, this kind of circularity is prevalent throughout the whole world, whether it is business investments, forests for harvest, or owning water rights. Without taking sides, it represents a real paradox in which an abundance of dollars are competing for the same assets.
For the Farmer, the challenge is if the value of farmland exceeds what the crops are able to pay.
