Feb
19

Fields of Gold

Focusing on two country studies of the USA and Brazil, Madeleine Fairbairn's "Fields of Gold: Financing the Global Land Rush" (2020) explores the financial side of the global rush for land. This book provides unique perspectives on a widely written about topic (often under the land grab or large-scale land acquisition frame, I've also used the land rush in a book). A downside to the book is that it seems almost all of the interviews were conducted between 2011 and 2015, creating a rather large gap between the data / issues covered and the date of publication. The author has put a full copy of the book on Academia (available here). A few notes:

"In recent years, the financial sector has developed a surprising interest in farms. Institutional investors—pension funds, university endowments, private foundations, and other organizations that manage huge pools of capital—are increasingly incorporating farmland into their investment portfolios. The same is true of those extremely wealthy people who in financial circles are euphemistically termed "high-net-worth individuals." This investor interest has spawned a host of new asset management companies eager to accommodate and encourage investors' newfound passion for soil. Promoting shiny new investment vehicles including farmland-focused private equity funds and real estate investment trusts (REITs), these managers promise to shepherd investor capital safely, and often extremely profitably, into plots of farmland the world over. This book examines why and how this transformation is taking place…" (p. 2)

"In the 1970s, this plodding increase in land prices once again transformed into a mad dash. The US entered another farmland boom, this time lasting from roughly 1972 to 1981. The causes of the boom were many: global droughts in 1972, a huge sale of grain by the US government to the Soviet Union in the same year, the devaluation of the US dollar, a highly inflationary environment that translated into low real interest rates, and a certain amount of ungrounded optimism." (p. 25)

"Perhaps the most fundamental shortcoming of voluntary guidelines, however, is that they take the land deals as a given. They start from the premise that con-version to larger-scale, more capital-intensive agriculture is inevitable—or even necessary for rural development—and then strive to make those investments more environmentally and socially friendly." (p. 138)

"A final approach to re-embedding land markets in the social fabric lies in alternative ownership structures, such as community land trusts (CLTs) and real estate investment cooperatives (REICs). Unlike the previous two approaches, these are not explicit responses to the (financialized) land rush, but rather efforts to address the negative impacts that rentier landownership and real estate speculation, in general, can have on communities. The CLT model is based on the idea that property ownership should not just benefit individual property owners but should instead serve the interests of the entire community, particularly its most disadvantaged members. Under the CLT model, the landowner is a private, nonprofit corporation that is governed by a board largely composed of local community members and homeowners/lessees of the trust. This entity owns the land, while the buildings on the land are available for purchase, and the building owners are granted extremely long-term, inherit-able leases for the property upon which their buildings stand (ninety-nine years is a common lease term)." (p. 142-143) 

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