Opinion editor's note: Editorials represent the opinions of the Star Tribune Editorial Board, which operates independently from the newsroom.
There was more on farmers' minds than usual at this year's recently concluded Farmfest.
Traditional issues — the weather, the economy and upcoming fall elections — had to share the spotlight with Chinese investors and Microsoft founder Bill Gates. Attendees at the annual Minnesota event, held in Redwood County earlier this month, are uneasy about recent regional agricultural forays involving both.
An entity affiliated with Seattle billionaire Gates recently acquired 2,100 acres of North Dakota farmland. Headlines have also been generated this summer by a Chinese-backed investment firm's plans to open a milling operation on 300 acres near Grand Forks, reportedly just 20 minutes from a nearby Air Force base.
While Midwest states, including Minnesota, have laws safeguarding farmland from foreign and corporate owners, these protections often date from another era. It's time to take a fresh look at them at the state and federal levels with an eye toward modernization and evolving national security needs.
For example, Minnesota's foreign ownership protections were mainly shaped in the 1970s. Even city dwellers know that farming has changed dramatically since then.
Globalization is a reality and here to stay, with technology enabling far-afield ventures. That allows Americans to do business far from home. But the converse is true as well, with foreign firms investing here. The Star Tribune's Farmfest coverage noted that "two of the nation's largest meat producers — Smithfield and JBS — are owned, respectively, by Chinese and Brazilian investors."
Gates also likely isn't the only business titan with money, spare time and interest in farmland investments.
The North Dakota attorney general recently signed off on the Gates-linked land purchase. By one publication's reckoning, the software pioneer is the nation's largest private landowner, controlling around 270,000 acres.
As dusty as the nation's farmland protection laws are, the reasoning for their existence stands the test of time. A 1978 Government Accountability Office report summed it up: Too much foreign investment could drive up prices beyond the reach of local residents and eventually enable foreign interests to gain "control over food production and possibly food prices."
Domestic corporate or concentrated ownership generates similar concerns. What would happen to food prices, for example, if one mega-owner suddenly wanted to pull hundreds of thousands of acres out of production?
While there is no evidence Gates intends to do anything like this, South Dakota U.S. House Rep. Dusty Johnson, a Republican, has sounded the alarm about Gates' purchases and the food supply.
U.S. House Rep. Tom Emmer, a Minnesota Republican, has also spearheaded drafting a letter raising concerns about foreign farmland ownership, particularly by Chinese interests. The letter, dated July 18, was addressed to Secretary of Agriculture Tom Vilsack and signed by 20 of Emmer's House colleagues, including Minnesota Republican Reps. Michelle Fischbach and Pete Stauber.
A recent Congressional Research Service (CRS) report provides valuable perspective as policymakers consider reforms. "In 2019, foreign persons and entities held an interest in 2.7% of U.S. privately owned agricultural land — covering crop, grazing, and forest land," the report stated.
China doesn't crack the report's top 10 list of "Foreign Holdings of Agricultural Land." The top five are key allies: Canada, the Netherlands, Italy, the United Kingdom and Germany. "China, Russia, and Iran accounted for a combined total of 0.2 million acres in 2019, or less than 0.7% of all foreign-owned agricultural land."
Still, that could rapidly change in a globalized economy. The CRS report notes that there are no current federal restrictions on the amount of private agricultural land that can be foreign-owned, though there are disclosure requirements. Protections against foreign and corporate ownership appear to mainly involve state law.
Concerns raised by the proximity of the Chinese milling plant's operations to the Grand Forks military base add to the reasons this issue merits federal scrutiny.
State lawmakers laudably are paying close attention. Sen. Torrey Westrom, R-Elbow Lake, chairs his chamber's Agriculture and Rural Development Finance Committee. In a statement, he said: "This concern has been brought to me by a growing number of my constituent farmers ... ."
Recent news coverage "confirms even more that this issue probably deserves a hearing and thorough review of our current laws. While I do believe that we have good measures in place to prevent foreign and corporate land ownership, it'd be good for a refresher course for legislators and the public, there is no harm in making sure our system can't be exploited or our food supply is put at risk of foreign ownership."
Westrom is right. It's time to revisit this issue and ensure that regulations are adequate to meet present-day needs.