WASHINGTON — It may not be a thing in Minnesota, at least not yet, but state lawmakers are among those concerned about the purchase of U.S. farmland by Chinese companies.
“I’m hearing from #MN08 landowners who are getting calls from Chinese companies that want to buy their land. We must protect our assets from (Chinese Communist Party) influence…,” Rep. Pete Stauber, R-8th District, posted on X earlier this month.
Stauber’s office declined to identify the constituents who have been approached by prospective Chinese buyers — or the Chinese companies purportedly involved.
Stauber is a co-sponsor of the Prohibition of Agricultural Land for the People’s Republic of China Act, a bill that would ban the purchase of “private agricultural land in the United States by foreign nationals associated with the Government of the People’s Republic of China.”
There is already a federal law known as the Agriculture Foreign Investment Disclosure Act (AFIDA,) approved in 1978, that requires a foreign person who acquires, disposes of, or holds an interest in United States agricultural land to disclose those transactions to the U.S. Department of Agriculture.
Yet those seeking tougher restrictions say the current law largely puts the onus on the buyer to self-report land purchases, and fines are rarely imposed for misreporting or not reporting at all.
The bill that would ban the sale of farmland to Chinese companies may not pass in this Congress since it lacks bipartisan support. But it is backed by many House Republicans, indicating a heightened concern about Chinese-owned U.S. farmland.
Attempts to limit foreign ownership of that farmland is not new to the federal government, beginning with the drafting of the Declaration of Independence by the nation’s founders.
According to the University of Arkansas National Agricultural Law Center, the most recent re-emerging interest in restricting foreign investments in U.S. land, especially agricultural land, is partly the result of a Chinese-owned company’s purchase of more than 130,000 acres near a U.S. Air Force base in Texas. Another transaction that raised concerns among some federal and state lawmakers was the purchase of 300 acres near an Air Force base in North Dakota by the Chinese company Fufeng Group.
There are several other privately owned Chinese companies that also own farmland in the United States, most notably the WH Group, which purchased Virginia-based Smithfield Food — the largest pork processor and hog producer in the United States — about 10 years ago.
Although the Chinese companies involved in the United States are privately owned, they operate in a bit of a gray area.
“China is a communist country so it’s difficult to distinguish between a state-run company and one that is regulated by the Chinese government,” said Harrison Mauzy Pittman, director of the National Agricultural Law Center.
‘Heard some rumors’
The USDA says no Chinese entity or individual owns any farmland in Minnesota.
That may be, at least in part, because Minnesota is one of about two dozen states that have laws restricting foreign sale of farmland.
Minnesota’s law mandates that only citizens of the United States, permanent resident aliens, and business entities that have less than 20% foreign interest can have an interest in state agricultural land.
According to the USDA, as of December of 2022 only 1.7% of Minnesota’s agricultural land was owned by foreign entities. The No.1 purchaser by acreage was the United Kingdom, followed by Italy, Canada and Germany. In all, about 582,000 acres of Minnesota are owned by foreign companies or individuals, according to the USDA.
Doug Spanier, the general counsel for the Minnesota Department of Agriculture, said he was not aware of any China-related purchases of land. “I’ve heard some rumors and stuff, but I haven’t seen anything concrete,” Spanier said.
However, like the federal law, Minnesota’s law regarding agricultural land sales relies on self-reporting.
So, Spanier said that unless a county assessor uncovers an unlawful sale “you don’t really know.
“We’re pretty active in trying to stop that kind of thing, but it doesn’t stop people from trying,” he said.
Spanier said that most of the foreign land purchases in Minnesota involve mining and lumber, which are exempt under the state’s ban on foreign land ownership.
But foreign ownership of American farmland is growing across the nation and could rise in Minnesota.
The USDA said foreign investors held an interest in over 43.4 million acres of U.S. agricultural land at the end of 2022. That was an increase of over 3.4 million acres from the December 31, 2021, report and represents 3.4 % of all privately held agricultural land in the United States.
Yet Pittman said fewer than 400,000 acres across the United States are owned by a Chinese company.
He said concerns about those sales started to increase in 2021 and spiked last year after the detection of a balloon floating across the United States that carried intelligence-gathering equipment.
“That changed the dynamics of the issue a lot,” Pittman said.
He also said “targeting foreign adversaries” like China, Iran and Russia “is on an uptick.”
Republican Rep. Brad Finstad, who represents a largely rural congressional district in southern Minnesota, hopes he can get some version of his Farm and Food Cybersecurity Act in the next farm bill — legislation that is overdue but expected to pass Congress next year.
Finstad’s bill would mandate that the USDA investigate possible cybersecurity threats and vulnerabilities in the agriculture and food sectors.
“With growing threats at home and abroad, it is increasingly important that we ensure our nation’s agriculture sector and food supply chain remain secure,” he said.
A spokeswoman for the congressman said Finstad was prompted to introduce the legislation by “China’s inroad into American agriculture.”
Finstad is also a co-sponsor of the AFIDA Improvements Act, a bipartisan bill that would toughen the USDA’s reporting requirements of farm land sales to foreign entities.
To Pittman, the threat posed by Chinese buyers of U.S. land “is a matter of perspective.
“I interact both with people who think (the sales) are a grave national security problem and with those who think the issue is a solution looking for a problem,” he said.
Ana Radelat
Ana Radelat is MinnPost’s Washington, D.C. correspondent. You can reach her at aradelat@minnpost.com or follow her on Twitter at @radelat.
