Foreigners rushing to invest in the United States this year have grabbed sizable amounts of commercial and industrial properties. But they have all but ignored one area many thought they'd go after: US farmland. Because of the distressed conditions of America's crop producers, low prices of world-class farmland, and future possibilities of heavy acreage yields, many experts predicted large farmland sales to overseas investors. But the experts were wrong.
At the end of 1986, foreign investment in US farmland increased only about 3 percent over 1985 - to 12.4 million acres - and totaled less than 1 percent of all privately owned US agricultural land. According to the Economic Research Service at the US Department of Agriculture, which is responsible for preparing the annual report on foreign-held farmland, 92 percent of this foreign-owned acreage in 1986 remained under the same cultivation usage as in previous years. And very little of this land was removed from production.
``As in every year in which we compile these data,'' said attorney Peter DeBraal, an Economic Research Service analyst, ``there needs to be some explanation of the figures.'' For example, in these statistics, forest land accounts for over one-half of this designated foreign-owned acreage. Fifteen percent of this foreign-owned forest land is in Maine, where it represents 10 percent of that state's privately held agriculture land. And this Maine acreage is owned by only three companies - two Canadian and one US-foreign joint venture.
All states except Rhode Island have some foreign farmland owners, though the majority of the holdings are in the South and West. Seventy percent of the foreign owners of US farmland are citizens of five countries - Britain, Canada, West Germany, the Netherlands Antilles, and Switzerland.
Under the Agricultural Foreign Investment Disclosure Act of 1978, foreigners are required to report US agriculture holdings, sales, and acquisitions each year to the USDA, and it must disclose whether there have been any changes in how this foreign-owned property was used.