Q&A:Foreign Ownership of U.S. Farmland
With U.S. Senator Chuck Grassley
Q: What are your concerns regarding foreign ownership ofU.S. food companies and farmland?
A: Foodsecurity is national security. If foreign buyers, especially those backed bygovernment regimes, are buying up prime farmland in America as a strategy todominate food production, there’s obvious concerns about protecting our abilityto feed our own people. Let’s start with China. For the past two decades inparticular, the Chinese communist government has systematically sought toundermine the United States to become the world’s greatest superpower, usingany means necessary, including espionage. From infiltrating American campusesthat posethreatsto U.S. researchto stealing trade secrets from anIowacorn field, smart public policy and robust enforcement of our laws arecrucial to thwart China from cheating its way to the top. More recently,fall-out from the pandemic exposed America’s reliance on China and its grip onsupply chains essential to the U.S. economy.
Nearly a decade ago, I called upon the U.S. Committee onForeign Investment (CFIUS) and the Department of Justice toscrutinizethe Shuanghui International purchase of Smithfield Foodsforrisk of vertical integration and adverse impact on the independent producer andnational security. Since then, I’ve continued my oversight work, pressing theUSDA and DOJ to beef up enforcement of antitrust laws to protect the U.S.economy. Last year, I re-introduced a bipartisanbillwithSen. Debbie Stabenow, chair of the Senate Agriculture Committee, that wouldgive top U.S. agriculture and food officials a permanent seat at thedecision-making table so that U.S. food and farm policy is taken into accountwhen control of a U.S. business by a foreign company is at stake. As foreigninvestors look to gobble up U.S. food and agriculture businesses, the federalgovernment has a responsibility to prioritize American sovereignty. CFIUS istasked with reviewing proposed mergers and acquisitions of U.S. companies byforeign entities. It currently does not include permanent representation fromthe USDA or the Department of Health and Human Services. Our bill would bringfood security into the conversation, where it belongs. Weighing the merits ofproposed mergers must also uphold the integrity and resiliency of the nation’sfood supply and the prosperity of Americans who produce the food that feeds us.
Q: What needs to happen to protect U.S. farmland?
A: I’vehad this issue on my radar for more than four decades, and I’m not about tostop now. We have roughly 900 million acres of American farmland in the UnitedStates. Iowa has 30.6 million acres in farmland. There’s a finite number offarmable acres on God’s green Earth. As a lifelong family farmer and seniorU.S. Senator who champions the interests of America’s Heartland, I’ve got avested stake to uphold stewardship of our rich, black soil as it passes fromone generation to the next. Plenty of food-producing acres are already at riskwith suburban sprawl plowing up farmland for housing and economic development.Consider institutional investors – pension funds, endowments and otherorganizations – are diversifying portfolios with farmland. This is driving upthe cost of food production and land prices.
We also need to be concernedabout foreign investments, particularly China. At the turn of this century,Chinese owners owned about 192,000 acres of farmland in the U.S., according tothe USDA. By 2019, the USDA says foreign ownership of U.S. acres exceeded 35.2million acres, a 60 percent increase from the decade prior. As a member of theSenate Agriculture Committee, I’ve long led the crusade to uphold the integrityof federal farm payments. A few years ago, IraisedCainto prevent foreign-owned Smithfield from feeding at the taxpayertrough with bailout programs intended to mitigate harm caused by China’s tradetariffs. My work for transparency started when I was in the U.S. House ofRepresentatives. I wrote theAgricultural ForeignInvestment Disclosure Actthat established a nationwide system tokeep tabs on foreign ownership; it directs foreign nationals to report theirU.S. agricultural holdings to the USDA. Like mycattlepricingbill andsunshinelaws, transparency brings accountability. Iowa has a law that restrictsforeign ownership of farmland. There’s growing concern laws on the books arebeing circumvented with complex business structures to skirt compliance.
The average age of a farmer inIowa is 58, and roughly four times more farmers are older than age 65 thanunder age 35. There’s an entire generation of ownership waiting in the wings.If deep-pocketed investors come in, foreign or not, it drives up prices andmakes it harder for new and beginning farmers to get started. I’ve worked toenact reasonable reforms to theConservationReserve Programso the federal government isn’t distorting themarketplace. When CRP rental acres are higher than cash rent in the county,that drives up the cost of food production and may drive the next generationout. Consider the recent kinks in our food production and distribution systemwith empty shelves at the grocery store, growing global population andgeo-political shenanigans by China and other foreign investors. U.S. publicpolicy needs to be forward thinking about investments in America’s farmland sothat potential consequences do not harm U.S. food and national security orunravel the economy and way of life in rural communities across America.
