The New Feudalism — does corporate buyout of farmland help to transform independent farmers into mere serfs?

In anticipation of Michael Schmidt’s visit to Saskatchewan early next month to talk about raw milk, here is some background on what’s happening with agriculture on the prairies. The story below is from The Globe and Mail where it’s titled “Do corporate buyouts signal the end of the family farm?“. The video below is not directly related. Thanks to Karen Selick for posting it first:

“Larry Spratt was combining with his father on their grain farm near Melfort, Sask., last November when a car pulled up along a nearby highway.

Out jumped Wally Johnston, a former Ontario farmer and now a vice-president at Bonnefield Financial, a Toronto-based investment firm. Mr. Johnston waved the Spratts over for a chat. “He said he was touring around Saskatchewan trying to meet farmers and we talked to him for a while,” Mr. Spratt recalls.

Mr. Johnston explained that Bonnefield was looking to buy farmland for investors and then lease it back to farmers to operate. The Spratts had heard the pitch before. They knew several farmers who had signed up with other investment companies and land prices in the area had been soaring as a result. Some farms were going for as much as $1,200 an acre, more than double the price in other parts of the province.

Mr. Johnston lucked out. It just so happened the Spratts rented a piece of land that was coming up for sale. Mr. Spratt and his father wanted to keep farming the acreage but they couldn’t afford to buy it. So he put Mr. Johnston in touch with the owner and they struck a deal. A few weeks later Mr. Spratt negotiated a rental arrangement with Bonnefield, a private firm that invests on behalf of wealthy Canadian investors. “It worked out well,” Mr. Spratt says from his home on the 8,000-acre farm.

Similar deals are being struck around the world in what has become an unprecedented rush by global investment funds to buy farmland. By some estimates these funds have sunk as much as $20-billion (U.S.) into these acquisitions. Last year alone they bought 111 million acres of farmland, a tenfold increase from previous years.

Saskatchewan has become one of the new frontiers in this global trend. The province has some of the most productive, and least expensive, farmland in the world. But restrictive ownership rules have largely kept out foreigners, pension funds and publicly traded companies. Pressure is mounting inside and outside Canada to change the rules and open up the province.

“There are people that are dying to invest large sums of money to acquire farmland in Canada that aren’t Canadian citizens,” says Jan Kaminski, founder of Bonnefield. “These people are absolutely open for business in Saskatchewan.”…”

Read the whole story on the Globe and Mail.com

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