by Daniel Munch, Economist, American Farm Bureau Federation

Foreign investment in U.S. agricultural land is a hot topic, largely spurred by media reports raising concerns about bad actors from adversarial nations purchasing land for potentially hostile purposes.

Several questions arise when considering this issue. First and foremost, how much agricultural land in the U.S. is owned by foreign investors and from what countries do those investors hail?

Second, what kind of land do these foreign entities own? Productive cropland? Forestland? Or perhaps open space for energy production or other purposes?

Additionally, how have these numbers changed in recent years? While data exists to answer many of these questions, the quality of these data points has often been questioned, complicating our true understanding of how much U.S. ag land is owned by foreign investors and who they are.

This article summarizes the latest available data with some critiques of its quality.

As noted in a January Congressional Research Service report, the Agricultural Foreign Investment Disclosure Act of 1978 (AFIDA) established a nationwide system for collecting information pertaining to foreign ownership of U.S. ag land (defined as land used for forestry production, farming, ranching or timber production).

AFIDA defines a foreign person to include “any individual, corporation, company, association, partnership, society, joint stock company, trust, estate, or any other legal entity” (including “any foreign government”) under the laws of a foreign government or with a principal place of business outside the United States. U.S. citizens and green card holders are explicitly excluded from AFIDA requirements.

The regulations require foreign persons who buy, sell or gain interest in U.S. agricultural land to disclose their holdings and transactions to USDA directly or to the Farm Service Agency office where the land is located.

Failure to disclose this information may result in penalties and fines through USDA investigative action. Maximum civil penalties of up to 25% of the fair market value of the interest held in land can be levied for those who fail to comply. The accuracy of disclosed data relies on voluntary compliance and self-reporting by the foreign entities.

To read the entire report click here.