..Wary of fluctuations on Wall Street, more wealthy Americans, private funds and foreigners are putting money into parcels of cornfields, fruit orchards and other U.S. agricultural products.HT: Infectious Greed
Reporting from Kern County, Calif. — As investors tire of Wall Street's roller coaster, more of them are plowing their money into land â farmland.
Few people understand this shift better than farm manager Carl Evers.
On a recent morning, Evers steered his pickup truck through a Central California almond grove, his drawling sales pitch at the ready. Evers is co-founder of Farmland Management Services, which runs about 30,000 acres of nut groves, fruit orchards and wine grape vines for a Boston investment firm. Sunburned and stocky, tugging down his wide-brimmed hat, he talked about how farmland â and the food it produces â is the safer bet these troubled days.
"You want to throw your money into something you can't touch?" said Evers, 50. "Or do you want to put your money here, into soil and sun, into food that feeds people around the world?"
It's the fourth time this year Evers has wandered through these trees and given his spiel to pension fund managers, hedge-fund operators and hungry investors on behalf of Hancock Agricultural Investment Group. He's reeled it off many more times over the phone.
Farmland has become hot. Average U.S. farm real estate prices â including the value of land and buildings â have nearly doubled in the last decade to $2,140 an acre, according to the U.S. Department of Agriculture's National Agricultural Statistics Service. Wells Fargo, the nation's top agricultural business lender in total dollar volume, said demand prompted it to increase farm lending 12% from 2008 to 2009. Since the recession began in December 2007, financial analysts say, agricultural investments have easily outperformed the Standard & Poor's 500 index.
Wealthy Americans and private funds alike are gobbling up Washington apple orchards, Illinois cornfields and Louisiana sugar plantations. So are foreigners. In California, investors from countries including Spain, Switzerland, China, Egypt and Iran collectively boosted their holdings 2.5% from February 2007 to February 2009 to 1.08 million acres â about 5% of the state's total farmland. Overseas, U.S. and other investors are snapping up tens of millions of hectares of farmland in Africa, Central America and Eastern Europe....MUCH MORE
Friday, September 24, 2010
"Investors seeing farmland as safer bet than stocks..."
From the Los Angeles Times: