Fundamentals of farmland investment

• 9.4% average annual rate of return to owners of farmland in Saskatchewan (1972–2003).¹
• Stable, income producing asset.
• An excellent hedge against inflation: “during the period from 1941 to 2002, average farmland values increased by almost two percent more than the average rate of inflation over that time period”.²
• Impossible to steal.
• In limited supply, and decreasing.³
• Fundamental to life.
• Relatively low risk – the standard deviation of annual rates of return on farmland is lower than for the stock market.
• Real hard asset – it won’t go to zero.

Lower the risk profile of your portfolio without lowering the return on investment. Large pension funds and institutional investors are beginning to place their money in farmland. Why shouldn’t you?

Farmland is a conservative, stable, income producing investment with inflation protection.

1. See Efficient Investment in Saskatchewan Farmland by Marvin J. Painter PhD, Associate Professor, College of Commerce, University of Saskatchewan. A summary is also available.
2. Hancock Agricultural Investment Group (HAIG), a division of John Hancock, the US investment management division of Manulife Financial.
3. For example, Wisconsin lost almost 500,000 acres of farmland between 1997 and 2002.