Regardless of considerations that China is shopping for or leasing all of the farmland in america, new Cornell-led analysis reveals that this isn’t the case.
30 September 2024
4 minute learn
Utilizing a federal dataset of greater than 40,000 international investments in U.S. agricultural land as of 2020, Wendong Zhang, assistant professor and extension economist on the Charles H. Dyson Faculty of Utilized Economics and Administration, and collaborators present that nations labeled by the federal authorities as “adversary,” equivalent to China, held just one% of the roughly 40 million acres of foreign-owned farmland. The highest international nation when it comes to possession of U.S. agricultural land? Canada, which owned a couple of third, a lot of it Maine and Michigan forestland.
And whereas international possession has elevated steadily over the previous 20 years, long-term leasing is the principle driver of the rising international pursuits, and lots of international transactions are associated to renewable-energy improvement.
“I took an interest on this, particularly Chinese language possession of U.S. farmland, due to the political consideration it was getting,” Zhang stated. “And there’s a rise in state-level laws, in Texas, Florida, Indiana and different locations. We needed to have a look at the info, given the unfold of rumors.”
Zhang is a co-author of “Mapping and Contextualizing Overseas Possession and Leasing of U.S. Farmland,” which seems within the 2024 Journal of the American Society of Farm Managers and Rural Appraisers. Different co-authors are Fangyao Wang, M.S. ’23, a analysis assistant in Zhang’s group; and Mykel Taylor, affiliate professor of agricultural economics and rural sociology at Auburn College.
“Most individuals are stunned to search out that China truly ranked so low when it comes to complete holdings, and most of the people wouldn’t essentially assume that Canada captures the lion’s share,” Zhang stated. “In fact, Canada and China pose totally different nationwide safety dangers, so the response may be very totally different.”
At present, 24 states have some type of restrictions on international possession of land, however every state’s restrictions range. In April 2023, Arkansas carried out laws that bars a “prohibited international celebration” (PFP) from buying agricultural land, and prohibits acquisition by any PFP-controlled enterprise.
The Chinese language spy balloon episode of 2023 – together with the thought that Chinese language possession of land close to delicate U.S. navy or intelligence installations might compromise nationwide safety – have made international possession of U.S. agricultural acreage a hot-button situation.
Whereas there isn’t an outright ban on international land possession on the federal degree, the Agricultural Overseas Funding Disclosure Act (AFIDA) of 1978 requires that international traders who purchase, switch or maintain an curiosity in U.S. agricultural land – together with leases of 10 years or extra – report such holdings and transactions to the secretary of agriculture.
By means of a Freedom of Info Act request, Zhang and his collaborators obtained info from the AFIDA database, which accommodates details about the international entities that maintain U.S. agricultural land, together with the identify of the entity, nationality, location, date of acquisition, acquisition strategies, land use (crop, pasture, forest and different agriculture) and different specifics.
The researchers reported three fundamental findings:
- Lengthy-term leasing of no less than 10 years or extra is the principle driving power of the rising international pursuits in U.S. farmland previously 20 years, but its necessary function stays largely ignored in present coverage debate. As of 2020, a complete of 38.3 million acres (2.9%) of U.S. farmland had international pursuits, up from 12.2 million acres in 2000;
- A substantial variety of international entities, particularly corporations, spend money on renewable power equivalent to wind and photo voltaic power improvement as a substitute of agricultural manufacturing; and
- Firms and people from “adversary” nations (China, Venezuela, Iran, Cuba and Russia) account for just one% of all of the foreign-owned agricultural land in america.
Zhang stated the group was motivated to do that analysis by the rumors concerning China’s need to purchase up U.S. agricultural land.
“There’s been discuss, particularly now throughout election season, that China is attempting to probably management thousands and thousands of acres of U.S. farmland,” he stated. “The proportion of land that’s underneath international management, both by means of purchases or long-term leases, may be very low general.
“There may be positively grounds for extra scrutiny and extra concern,” he stated. “The share of foreign-owned land has elevated considerably over the past 20 years, however nonetheless the general share is pretty low.”
Extra info on international land holdings of New York state’s agricultural land is offered within the authors’ Dyson Extension Bulletin.
As famous in a latest report by U.S. Authorities Accountability Workplace, higher knowledge monitoring and extra well timed sharing of information inside authorities businesses is required to make sure the reliability of the knowledge reported to Congress or the general public about the place and the way a lot U.S. agricultural land is held by international corporations or people.
This analysis was supported partially by the U.S. Division of Agriculture’s Nationwide Institute of Meals and Agriculture.
