Western Farm Press Logo

There is a scramble for farmland globally, and it turns out it is not just to grow food. Investors are discovering returns on farming land that rival those of the U.S. stock market.

May 20, 2011

1 Min Read

From the Philadelphia Inquirer:

Yields on farmland can be quite good, and not just in crops. For investors, the opportunities are growing.

There is a scramble for farmland globally, and it turns out it is not just to grow food. Investors are discovering returns on farming land that rival those of the U.S. stock market.

Some Wall Street luminaries have long been fans of farmland as part of an investment portfolio. Why? The Standard & Poor's 500-benchmark index's average annual return was 11.8 percent between 1950-2008, while the return on farmland with capital appreciation and current yield was 11.6 percent.

What makes up farmland's returns? There are three components:

Capital appreciation of the land itself.

The current cash yield, from grown crops harvested every year.

Assets such as livestock and seed sales, hunting rights, mineral rights, water rights, even wind rights.

For more, see: Fertile ground for investors: Farmlands

Subscribe to receive top agriculture news
Be informed daily with these free e-newsletters

You May Also Like