Land Investment Monthly – June 2016

Published on Jun 15, 2016

Capital Ag
Innovation and investment are colliding as the startup and venture capital culture gains a foothold in food and agriculture industries worldwide. A new report by AgFunder reveals that global investment in ag tech has been about doubling annually for the last four years. From variable rate technology and remote sensing applications – to increasing use of greenhouses and innovations centered on reducing waste by extending the shelf lives of produce – it all ties back to the world’s ability to feed 2.3 billion more people, sustainably, by 2050.
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Sizing Up
24/7 Wall Street generated an update to its reporting on “The Most (and Least) Valuable States” with regards to land values. The editors provide a breakdown of additional components to their original analysis, including population density, land composition, and median occupied home values. California, accounting for 17 percent of the total value of the 48 bordering states, was the most valuable state, while New Jersey had the most valuable real estate relative to its size. A lower value is typically associated with states that have larger rural areas, relative to their size. One study estimates that the combined value of all land in the contiguous United States is worth nearly $23 trillion. 
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Water Bar
The largest water supplier in Southern California has been temporarily barred from proceeding with a land deal related to the proposed development of twin tunnels under the Sacramento-San Joaquin River Delta. The Associated Press reports on the stalled $175 million purchase of 20,000 acres. Two counties that oppose the tunnels assert that Metropolitan Water District failed to study the potential impact of the deal on a fragile delta in the drought-stricken state. The $15.7 billion tunnels plan also awaits regulatory approval.
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Tank Tomato
Russian billionaires are pouring cash into agriculture while making investments in produce such as the T-34 tank tomato as food exports, and food prices, soar. Last year, Russia overtook the U.S. this year to become the biggest exporter of wheat. A grain surplus and weaker ruble also helped increase its food exports to a record $20 billion – more than the country earned from arms sales. Russian President Vladimir Putin has re-affirmed a national goal of achieving food self-sufficiency by 2020. Some estimate Russia has more than 40 million hectares, or about 99 million acres, of idle land that is suitable for agricultural production.
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Rural Look
The Senate Agriculture Committee took a hard look at the business end of difficult economic conditions experienced by farmers and ranchers in recent years. Two panels, each offering different opinions with regards to the Farm Credit System and rural America, shared their views during a May 19 hearing. In the past three years alone, net farm income was expected to decline by 56 percent. The hearing examined the overall climate of credit in rural America, and oversight of the system. High Plains/Midwest Ag Journal reports.
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Local Demand
Demand for locally grown foods is on a collision course with a booming Northeast real estate market. The New York Times reports that lawmakers have teamed with a preservation group – with a goal of maintaining the region’s existing food system and farmland in the Hudson Valley. The number of farms in New York State declined to 35,537 in 2012, from 38,264 in 1997, according to Department of Agriculture’s most recent five-year census. Data compiled by American Farmland Trust show that, since 1982, real estate development has eaten up more than 471,000 acres of the state’s farmland.
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Land Tax
Reuters considers how U.S. farmland is appraised for property taxes. All land is taxed based on either market value or fair use. Reporter P.J. Huffstutter draws attention to this and other facts in terms of crop prices, farm incomes, soil type and productivity, cash rents, land appraisals, interest rates and more.
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The Land Investment Monthly is a round-up of articles and headlines published by the farm press, business media and financial publications with insights into buying, selling or investing in farmland, recreational ground or development ground. Follow Steve Bruere @SBruere on Twitter and find Peoples Company on Facebook for the latest land listings, auction results, upcoming events and real estate news. To subscribe to my monthly updates via email, send a message to with “Land Investment Monthly” in the subject line.