Mandryk: Sask. agriculture minister's denials on foreign farmland ownership bizarre

[westernvicki]

Something about the million dollar combine, and tractor requiring more land for economies of scale. But, the issue of foreign ownership is indeed one that is carefully guarded in many nations. Another issue, intergenerational land transfer is of concern in particular due to the demographics of our farming population

The CBC recently did a story, concerned about youth access to ag. You have to wonder, the motive of this story. As indeed entry of youth into agriculture is historically a barrier.

The UK has moved to tax inheritance, in an effort to redistribute land.

The capital gain tax will transfer a huge amount of western Canadian wealth to central Canada, money that tax policy could redirect into declining capital investment.

On a positive note, he rules over the most sustainable farms in the world and should put this on provincial border signs noting this. Then make provision to cash in on this with carbon tax credits enabling Saskatchewan to be paid for the billions in carbon sequestration via "cap and trade" as a measure to deal with falling income.

Land value and debt indeed are way more rewarding with profits.

This Ag Minister will have his hands full, hope he is a fast learner, has forward thinking advisors, and is immediately up to the task.

[foragefarmer]

STO, to some extent it's too late unless the rules are enforced retroactively. The horses have already left the stable.

Was it simply lack of foreign and out of province ownership that kept Sask land prices at a discount to Alberta and Manitoba's? Or Was it simply economics, until grain farming became more profitable? In my opinion Alberta land prices were propped up by excess oil money sloshing around looking for a home. Manitoba land prices may have had an edge because of productivity. That being said, there are always areas within each province that had higher land prices than others in the same province.

Has foreign ownership of Western Canadian farmland been on the provincial radar in Alta and Manitoba as it has in Sask?

All of Manitoba has had fierce competition on farmland purchases the past 15-20 years now.

Foregin investment purchases of farm land started in the 70's in Manitoba.

The Red River Valley (high production), Portage (vegtables), Carmen, Morden/Winkler (speciality crops) have been getting top dollars for farmland for decades.

Hutt's are clustered tighter within Manitoba compared to Sk and Ab.

Not directed at you soley Farma, but to others who have mention farmland rent prices,

Why shouldn't retiring farmers who worked their asses off for 60 years leave their land to children and grandchildren to collect rent on if they choose not to farm.

I see farmland as an investment for future generation to prosper on either way. I don't need to be the richest casket in the cemetery when the time comes.

[AlbertaFarmer5]

Keeping in mind that Canada is a capital starved nation and most of our wealth producing industries are highly capital intensive. Shutting out foreign investment would be fatal for industries such as mining and oil and gas.

Though in agriculture I suspect that is a zero-sum game where the biggest capital investment is in the land. Bringing more external capital in just drives the cost of land up.

[foragefarmer]

Thanks for the post, I never thought of that.

[shtferbrains]

I visited Denmark once.
They have strict laws guarding against foreign ownership of things like farmland and vacation properties.
They say if they didn't control it the Germans would have owned everything desirable long ago.

[shtferbrains]

Keeping in mind that Canada is a capital starved nation and most of our wealth producing industries are highly capital intensive.

Has been a big problem getting any investment here recently.
Real Estate is where much of the money has been going.

[foragefarmer]

With all the turmoil in the major oil producing areas of the world right now, oil sits at $68.00/b.

Not hard to figure out why investment isn't flowing into O+G but rather into Real Estate.

[AlbertaFarmer5]

With all the turmoil in the major oil producing areas of the world right now, oil sits at $68.00/b.

Not hard to figure out why investment isn't flowing into O+G but rather into Real Estate.

Now apply that logic to agriculture. Last I checked, agriculture commodities were at historic lows compared to most other commodities. And if we consider land values to be a proxy for investment in agriculture, it is at all time highs.

Is this just because of investors/farmers betting on misguided government biofuels policies? Short oil and long agriculture?

[farmaholic]

What company in their right mind would invest any more than they had to in Western Canadian oil and gas with the current federal government and their agenda/policies since late 2015? And don't forget the impact Covid had on the economy. Oh yeah and that crushing "cumulative affect" carbon tax.

Picking winners and losers. In some cases the chosen winners will never stand in first place on the podium.

[foragefarmer]

Now apply that logic to agriculture. Last I checked, agriculture commodities were at historic lows compared to most other commodities. And if we consider land values to be a proxy for investment in agriculture, it is at all time highs.

Is this just because of investors/farmers betting on misguided government biofuels policies? Short oil and long agriculture?

I realize you'd like to erase this time period from your memory, but was it government policies regarding biofuels when commodities hit record prices in the winter and spring of 2022?

What effect did that hangover have on the land and rent prices of today?

Ab5, you run your business with far to much government involvement.

[AlbertaFarmer5]

Yes. A big part of the hype that drove oilseeds to record highs was based on government policies regarding renewable Diesel and sustainable aviation fuels. And the spillover effect to the other grains.
The supply and demand for grains in 2022 in no way justified the extreme valuations. Neither did the Ukraine war.

[chuckChuck]

Take away government mandates for biofuels and the grain industry will be in much bigger trouble.

Farmers love to extoll the virtue of "free markets" but biofuel mandates are an indirect subsidy on a massive scale.