The confirmation process for Brooke Rollins, Trump’s nominee for secretary of Agriculture, is taking place as America’s farmland is undergoing a radical transformation.
High land prices and a rise in institutional investing in farmland are making it difficult for small farmers to compete. These trends are fraying rural communities and leading to a generational exodus from farming as food prices are elevated and the demand for local products has grown.
The stakes are high. The aging farming population is expected to turn over 400 million acres of land in the next decade as farmers retire. Whoever comes to control this land will determine the next chapter of American farming and food production. Restrictions to institutional investing in farmland, community initiatives like land trusts and government agricultural credits and subsidy schemes should ensure that small farmers remain a centerpiece of American farming.
The 2008 financial crisis shattered urban and suburban areas; more than 1 million people lost their homes through foreclosure, and homebuilding has yet to recover. Institutional investors have since become major owners of housing and valuable urban and suburban land, a trend that accelerated during the pandemic.
Rural areas have been similarly hard hit, despite their weaker starting position. By the mid-to-late-20th century, once-autonomous and self-sustaining small farmers began to face immense pressure for their land from growing agricultural conglomerates and increasingly competitive globalized markets. A lopsided subsidy scheme arose around a few crops such as corn, soy and wheat that could be more profitable when farmed at scale.
With that came the regulatory capture of the Department of Agriculture and a raft of other policies that favored big agriculture in industries such as dairy and meatpacking.
The 2008 financial crisis and the pandemic squeezed small farmers in new ways. The value of farmland owned by investment groups has grown nearly 10 times since 2008, and it has tripled over the last three years. That has moved in tandem with spiking farm real-estate values, which have increased almost 40 percent over the last decade. High inflation and stock market volatility increase the attractiveness of farmland for investors, because farm prices closely track inflation and rarely decline.
Small farmers are increasingly worried about farmland financialization. Pension funds and university endowments are acquiring large portfolios of land, outcompeting family farmers and hollowing out rural communities. At the same time, billionaires like Bill Gates and Jeff Bezos have come to own hundreds of thousands of acres of farmland, joining other wealthy landowners like the Emmerson family, Ted Turner and John Malone. Many farmers fear that this trend will continue as the farming population retires and as land values increase with climate change.
Longstanding trends toward a smaller farmland base and increasing farm sizes make these changes especially acute. Farmland area is declining at the rate of 35 million acres per decade due to pressures from development. And average farm size has more than doubled since 1950 to over 460 acres, favoring larger farms. Today, 8 percent of farms own 40 percent of farmland.
Minority farmers are uniquely challenged. At the start of the 20th century, nearly 14 percent of U.S. farmers were Black. But after nearly a century of discrimination and a lack of access to USDA credits and subsidies, minorities own only 2 percent of farmland today, while 60 percent of farmworkers are people of color. Trump’s immigration policies pose a major threat to these farmworkers, most of whom are foreign born and many of whom lack formal work authorization.
Ensuring that small farms remain viable is important for American jobs, food security and the ability of rural communities to thrive. One emerging solution is the creation of community land trusts, which take land from the market and put it under community control. Land trusts are becoming increasingly widespread, and they can protect and foster small farmers, but they need far more investment to succeed at scale.
Federal and state governments have an important role in ensuring that small farmers have access to credits and subsidies for a wide range of crops. Just last summer, the federal government started distributing payouts to thousands of farmers who suffered government-backed racial discrimination in farm aid programs.
Limiting institutional investing in farmland is also necessary. Some states already have investment limitations, and there have been initiatives in Congress to restrict purchases of farmland by institutional investors.
Small farmers across the board want an even playing field under the next secretary of Agriculture, and if given the chance will be a continuing force in American agriculture.
Michael Albertus is a professor of political science at the University of Chicago and author of the book “Land Power: Who Has It, Who Doesn’t, and How That Determines the Fate of Societies.”
