OAK BROOK, Ill. – The future of farmland ownership was a part of the discussion during a recent Farm Foundation Forum.

Participants also shared their thoughts on farmland investment, foreign farmland ownership and the plight of socially disadvantaged farmers during the July 18 forum.

Among the things impacting agricultural land ownership and investment in the U.S. are changes in the farm and ranch community, particularly change in intergenerational transfers of farms and ranches, noted David Haight, vice president for programs with American Farmland Trust. According to the 2017 Census of Agriculture, there were four times as many senior farmers than young farmers. Forty percent of those senior operators did not identify a young farmer being involved in the ownership and/or management of the farm, he said.

“This is significant because farms that are at a time of transfer are vulnerable,” Haight stated. “For many of these families, they’re going to have to look outside the family for that next generation. Certainly, for some (farms), this is a time when they can be lost to real estate development. We’re talking about hundreds of millions of acres. Senior farmers and landowners in this country own 370 million acres of agricultural land. So you can imagine in the next 20 years, there will literally be hundreds of millions of acres changing hands.”

The U.S. has about 940 million acres in private land ownership associated with agriculture – cropland, pastureland, range land and woodland, he said. Also, there are about 215 million acres of public land associated with agricultural use – principally grazing land on federally owned land in the western United States.

The American Farmland Trust released a report last year, “Farms Under Threat 2040.” It projects about 18 million acres of U.S. agricultural land are going to be fragmented, developed or paved over by 2040, particularly concentrated in states such as Texas, North Carolina and Georgia, he said.

“This competition for land with other potential buyers is going to be a significant force that is going to be shaping land ownership patterns in the future,” Haight pointed out.

Howard Halderman, president of Wabash, Ind.-based Halderman Farm Management and Halderman Real Estate Services, said 40 percent of U.S. agricultural land is owned by someone who doesn’t farm it themselves. Halderman said his clients are individual landowners and some institutional landowners.

“I would argue they are an important component to United States agriculture in terms of the capital stack and land ownership,” he said “Think about this. If you farm 5,000 row crop acres, you’re a fairly significant farm operator. You might own 20 percent of that. That’s 1,000 acres. Here in Indiana, 1,000 acres is $15 million. That’s a lot of money in today’s world.

“It is tough to own all of the land you may wish to farm with the equipment and the technology that’s available today. So leasing land has been a method of acquiring additional assets to have in your portfolio. That’s been in place for generations and decades and centuries.”

U.S. agriculture is an intensive capital investment, he stated. Equipment and putting talent into place – in addition to the land itself – are expensive propositions, Halderman said.

This year, 65 percent of Halderman’s farmland sales have been to farmers, while 35 percent have been to investors. Last year, 54 percent were to farmers and 46 percent to investors.

Halderman said he received questions about Chinese ownership of U.S. agricultural land during seminars last winter on farmland values.

As of Dec. 31, 2021, 40 million acres – 3.1 percent of all U.S. farmland – was foreign owned, he said. Of those 40 million acres, 47 percent was forestland, 29 percent cropland, and 22 percent pasture and other.

Chinese ownership of U.S. farmland is 1 percent of the total of foreign owned, Halderman said. Most foreign ownership is western European Union, Australian and South American.

Legislation has been introduced at the federal level aimed at restricting foreign ownership of U.S. farmland, he said. A similar bill has been passed in Indiana.

“I look at that as being a little bit troubling because Halderman has clients from the UK, Germany, and Denmark who want to buy land here,” he explained. “So you’re restricting our business with some groups that I think would be positive to have a relationship with here in the state of Indiana.”

There might be better ways of handling foreign ownership at the federal level, Halderman added.

Eloris Speight, director of the Socially Disadvantaged Farmers and Ranchers Policy Research Center at Alcorn State University, discussed the Justice for Black Farmers Act of 2021.

The act was an attempt to create economic justice by eliminating lingering federal discrimination by creating fair access to credit and federal programs, which will provide the tools to grow that dream into a reality, she said.

“The bill put in place market reforms and invests substantially in regenerative agriculture to help level the playing field and make it possible once again for independent family farmers and ranchers across the country to thrive,” Speight explained.

Legislation such as this is necessary, in part, to help stop the decline in the number of Black farmers in the U.S., she said. In 1920, there were nearly 1 million Black farmers, and 926,000 Black-operated farms.

The 2017 Census of Agriculture counted fewer than 50,000 Black farmers, and 35,470 Black-operated farms.

“The Black-owned farms that remain are smaller on average than other farms and Black farmers make a fraction of what white farmers make in farm income,” Speight said. “Without intervention, Black farmers will become extinct.”

The number of Native American producers is increasing, according to Whitney Sawney, director of communications and policy for the Native American Agriculture Fund.

The amount of support for the next generation of native farmers and ranchers is also growing, she said.

A survey found that during times of disruption, such as the pandemic, a lot of native people turned to their tribal governments for support and assistance, Sawney noted.

“Tribes are starting to develop their own tribal departments of agriculture or natural resource departments,” she said. “They’re managing these resources to support native producers.”