Investor Ownership Of American Farmland May Be Good For The Environment A trillion dollars worth of American farmland will change hands in the coming years. Wealthy investors are likely to buy more of it with the power to shape rural communities and the environment.
NPR logo

Big-Money Investors Gear Up For A Trillion-Dollar Bet On Farmland

  • Download
  • <iframe src="https://www.npr.org/player/embed/892366385/901219124" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript
Big-Money Investors Gear Up For A Trillion-Dollar Bet On Farmland

Big-Money Investors Gear Up For A Trillion-Dollar Bet On Farmland

  • Download
  • <iframe src="https://www.npr.org/player/embed/892366385/901219124" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript

STEVE INSKEEP, HOST:

About one-third of America's farmland is owned by people over the age of 75. As their land comes up for sale, much of it is bought not by a new generation of farmers but by investors. Here's NPR's Dan Charles.

DAN CHARLES, BYLINE: Ray Williams is enjoying his life as a not-quite-retired farmer in northeastern Oregon.

RAY WILLIAMS: Beautiful day, got some exercise, nothing but First World problems...

CHARLES: He was once an attorney. Then, he and his brother Tom turned to farming, growing wheat and feeding young cows on 3,000 acres along the Oregon-Washington border. They took it organic and then decided last year they were getting too old for those 80-hour weeks.

WILLIAMS: Like I told our clients when we let them know that we're going to be selling, you don't want to rely on senior citizens for your high-quality organic products. Trust me on this one.

CHARLES: The farm sold for more than $20 million to a company registered in Delaware with a mailing address in Manhattan. The people behind it want to remain anonymous. It left Ray Williams with a pile of money to invest. Commercial real estate seemed too risky, so did stocks.

WILLIAMS: And so you go back with what you know. And so we know farming.

CHARLES: The land broker who helped sell his farm told him about 300 acres of land for sale in Butler County, Iowa, part of Rich Showalter's farm. So I went to see Showalter.

Describe it. How would you evaluate this land?

RICH SHOWALTER: If you get rain and if it's good-draining soil, it'll produce. It does good.

CHARLES: It's a big field of corn with a tree-lined stream running along the southern edge. Showalter and I take shelter from the heat under a cottonwood tree.

SHOWALTER: I'm 74 years old. I still farm. I'm there every day with my boys - three sons.

CHARLES: This is the first land he bought in 1975, back when he was just starting out on his own.

SHOWALTER: After 50 years, I pretty much know this farm pretty good.

CHARLES: But it's 20 miles from the rest of his land. His sons were pushing him to sell it.

SHOWALTER: I don't know. The boys talked me into it. They said, Dad, it's too far away.

CHARLES: And Ray Williams way off in Oregon bought it for about a million and half dollars. He's now renting it to a different farmer. So two farms in Oregon and Iowa, previously owned by farmers, now held as parts of investment portfolios. People far away from that land will decide what to do with it.

Dave Muth from Peoples Company in Des Moines, the land broker who helped arrange both of those deals, says this could soon happen on a massive scale across the country.

DAVE MUTH: Right now over 80% of the land - farmland in the U.S. is owned by somebody 55 or older. And roughly half of that is somebody that's actually 75 or older.

CHARLES: The pool of farmers or their children who can afford to buy that land is shrinking. The number of investors who'd like to buy it seems to be growing. The day I met the president of Peoples Company, Steve Bruere, he had to step out of the room for a while to talk to somebody in an East Coast city who apparently has $25 million to spend on farmland.

STEVE BRUERE: Yeah. So he wants to hop on a plane and come out and see us in two weeks. So you know, that's how this stuff goes.

CHARLES: And what does he want to buy?

BRUERE: He doesn't know.

CHARLES: Bruere says the shift to investors buying land will happen more slowly in places like Iowa, where tens of thousands of different people own small pieces of land and the state doesn't allow corporations to buy it. For now, local farmers are buying most of the land there that comes up for sale.

But the shift is already starting to change the shape of farming in other places, like the Mississippi Delta and the Pacific Northwest. Take the farm that Ray Williams used to own. Peoples Company now has a long-term contract to manage it on behalf of those anonymous investors.

BRUERE: You know, what we're doing out there in Oregon is really where this is headed, I think.

CHARLES: The new owners have poured money into the farm - rebuilt the irrigation system, bought the latest, smartest farm equipment. Dave Muth pulls out his cellphone, launches an app. And suddenly, we're looking at the control panel of a tractor on that farm 1,500 miles away. We can see what the person driving it sees.

MUTH: We've got the direction, 49% fuel, the machine speed - 7.3 mph.

CHARLES: Wow. Look at that. We're going through the field.

MUTH: Yep.

CHARLES: Is it your feeling, too, that this is kind of where farming is headed?

MUTH: Absolutely it is. And it almost has to in a lot of ways.

CHARLES: There are such powerful forces behind it, he says - demographics, technology that lets you manage farming remotely and on a vast scale. But a lot of people do feel there's something that's lost in that change - even the people who sold the land, like Rich Showalter...

SHOWALTER: I would rather sell it to fellow farmers, neighbors. But it's just a lot of money, you know.

CHARLES: ...Also Ray Williams.

WILLIAMS: I don't know how you talk about land. I mean, to me, it's really tied up with this income distribution thing.

CHARLES: More wealth in fewer hands, he says, means fewer people have the money to get into farming, which is sad.

WILLIAMS: Working outdoors with people I care a great deal about, seeing plants grow has lengthened my life. And I wish other people had more opportunities to do that.

CHARLES: But I'm not sure how to make that happen, he says. It's a problem that goes way beyond farming.

Dan Charles, NPR News.

(SOUNDBITE OF SPIRO'S "MARINEVILLE")

Copyright © 2020 NPR. All rights reserved. Visit our website terms of use and permissions pages at www.npr.org for further information.

NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.