Organic Farmland Investing

Written By Jeff Siegel

Updated March 25, 2024

Marc Faber got it wrong…

While I won’t argue the fact that Faber is a thousand times smarter than me when it comes to investing, the man said something last week that’s simply way off base.

In an interview on Bloomberg TV, Faber made the following statement:

…because of modern central banking and repeated interventions with monetary policy, in other words, with QE, all around the world by central banks — there is no safe asset anymore.

Indeed, the cause for concern regarding central banking is sound. Faber got it right on that. But to suggest that there are no safe assets anymore is ludicrous.

Great Advice!

When pushed into a corner to offer investment advice, Faber noted that if he had to turn anywhere, it would be the mining sector, specifically precious metals, mining companies, and gold shares, saying:

I would buy mining stocks. I am not saying they will go up, but I think they will go down less than a lot of other shares.

Great advice for investors who want to invest their hard-earned cash in stocks that will “go down less than a lot of other shares.”

No thank you!

The Millionaire Farmer

Truth is, there are plenty of valuable assets you can buy today that’ll pay off quite well over the long term.

One in particular is arable farmland.

According to a new USDA survey, rented farmland acres, combined with buildings on this land, are valued at more than $1.1 trillion. And in 2014, all of the landlords combined received $31.2 billion in rental income while incurring $9.2 billion in total expenses.

Now, here’s the deal…

About 91.5 million acres are slated for ownership transfer in the next five years, not including farmland that’s in or is expected to be put into wills. Landlords expect to keep or put nearly 48% of these acres in trusts. Only 21 million acres of land are expected to be sold to a non-relative, while 26 million acres are expected to be sold to a relative or given as a gift.

This means only a small percentage of farmland will be available for new entrants into the farming sector.

But wait, there’s more!

Most farmland in the U.S. is used for industrial purposes — that is, mostly industrially produced corn and soy, which devalues the land year after year.

The more synthetic fertilizers and pesticides raining upon these industrial crops, the quicker the nutrient value of that soil diminishes. The end result is soil that’s on life support.

In other words, it can only support new crops with the assistance of more and stronger chemical and fossil fuel inputs. That means it becomes more and more expensive to farm, and as an added bonus, the nutritional value of the food diminishes.

So when I say farmland is a valuable asset, it is.

But organic farmland is an asset that is significantly superior to farmland that has been abused by industrial farming practices. In fact, only about 1% of all farmland in the U.S. has been certified organic, yet demand for organics continues to enjoy rapid growth.

This has resulted in a supply shortfall, which in turn has resulted in organic foods typically enjoying premiums of 30% to 200% over conventional foods.

The truth is, while the market continues to screw with my emotions, I continue to seek out new opportunities to invest in organic farmland or farmland that’s in good enough shape to be converted to organic. And in upcoming issues, I’ll share those with you.

To a new way of life and a new generation of wealth…

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Jeff Siegel

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Jeff is the founder and managing editor of Green Chip Stocks. For more on Jeff, go to his editor’s page.

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