Does anyone here has any experience investing in farmland? Hard times are coming, and I believe having some farmland would be helpful. Do you know any farmland investments that would pay dividends? Please share your thoughts!
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It's easy to refute an argument if you first misrepresent it. William Keizer
I personally believe the whole farming investment business should be analyzed with more than a grain of salt.
Food prices are both high and volatile right now. Problem is these high prices do not translate in steady profits for farmers (be them individuals or companies) and volatility causes a lot of uncertainty: in fact some sectors (like pork in Europe) are seeing the lowest paid to producers in many, many years. The pricing system is broken, and investors are cautious, rightly so I may add.
If you want a good farming-related investment I can give you two tips in lieu of owning proper farmland (I worked on the family farm in my youth and it's not a job for everybody) .
The first is owning stocks in Deere & co, maker of the legendary John Deere tractor. Not only do they make some damn fine machines (I can vouch for that) but it's also an extremely well-run company. Their products are in extremely high demand all over the world, even China, and they are the leaders in agricultural mechanization, end of story.
The second is investing in rice. No need to go to Asia: the US is one of the top exporters and Riceland (headquartered in Stuttgart, Arkansas) is the single largest rice producer in the world. Rice has been on a steady and unstoppable rise in the past few years, its price is less volatile than other grains. The fact all Asian countries (with the exception of China) hold extremely low rice reserves should say quite a lot.
Finally I have not a lot of experience but peanut-related products are on a similar trend to rice. May be worth a look.
Don't invest in the US, especially US agriculture. The Washington, DC Politburo virtually dictates where every grain of wheat and every ear of corn will be grown in this country.
Clayton -
Clayton, I happen to agree with you. So what is your recommendation? Where? Asia? How? Please share
The Washington, DC Politburo virtually dictates where every grain of wheat and every ear of corn will be grown in this country.
Do tell more, please.
You can invest in your local organic farmer. You get crop shares to boot.