Emerging Issue: Foreign Ownership of Agricultural Land

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Date Posted: April 14, 2023

Michigan Farm Bureau

According to a USDA Farm Service Agency report “Foreign Holdings of U.S. Agricultural Land,” foreign investors held interest in roughly 40 million acres of U.S. agricultural land, including both forest land and farm ground, as of Dec. 31, 2021. This equates to 3.1 percent of all privately held agricultural land in the U.S. and 1.8 percent of all land in the U.S.

When you look more closely at the data you find that forest land accounts for 47 percent of all reported foreign-held acreage, cropland for 29 percent, pasture and other agricultural land for 22 percent, and non-agricultural land for 2 percent. The non-agricultural land category includes homesteads and roads.

Our Canadian neighbors own the largest amount of foreign-held agricultural and non-agricultural land, with 12.8 million acres. Foreign investors from the Netherlands, Italy, the United Kingdom, and Germany own a combined 12.4 million acres with the remaining 15.6 million acres being owned by investors from various other countries.

In Michigan, roughly 1.39 million acres of agricultural land is held by foreign investors with 85 percent of this land in forests and nearly 13 percent in cropland. Investors from the Netherlands own 33 percent of the land with Canadians owning 27 percent.

Counties with the most foreign-owned agricultural land, which is mostly in forests, are Keweenaw, Baraga and Alger. The counties with the most acres of foreign-owned cropland are Gratiot (44,330 acres), Shiawassee (31,192 acres), Lenawee (24,067 acres), and Huron (17,484 acres).

Foreign holdings of U.S. agricultural land increased modestly from 2009 through 2015, increasing an average of 0.8 million per year. Since 2015, foreign holdings have increased an average of 2.2 million acres annually. With the recent increase in foreign ownership of agricultural land there has been a renewed interest in limiting these purchases by changing federal and/or state requirements.

Currently, federal law has no restrictions on the amount of private U.S. agricultural land that can be foreign owned. However, foreign persons and entities are required to disclose to USDA information related to foreign investment and ownership of U.S. agricultural land.

Some states have restrictions on foreign ownership of farmland, but Michigan does not. While there is not a uniform approach among states to address foreign ownership the laws fall under a few categories: prohibitions or limits based on which country the prospective owner is from; additional disclosure requirements; restrictions on the amount of land that can be owned or for how long; distinctions in how agricultural land is defined; differences between resident/nonresident aliens; restrictions on ownership by foreign corporations; and exemptions for specific types of agriculture.