Investing in Sustainable Farms

How to Invest in your Local Family Farm

Written by Brian Hicks
Posted November 26, 2014

honfarmMr. Reedy used to let us walk the cows back to the milking parlor. But only during summer, when we weren't in school.

Although I should clarify, it's not like he actually invited us to do this. We would just happen to be nearby, playing in the barn, diving off the hay bales, and hunting for rodents. And when he went out to bring the herd in, we would follow him like the eager rambunctious boys we were.

I suppose we were probably more trouble than anything. But he was a good guy and entertained our desires to feel important.

Growing up across the street from a dairy farm was a blast. And although some folks weren't keen on the smell of sweet, sweet manure, I never really noticed it. At least not until the farm was turned into another housing development eyesore. At which point I realized how much I missed it.

The Righteousness of Farming

I was only about 13 when Mr. Reedy sold the farm.

I don't know how or why the deal went down, although I suspect the aging farmer wasn't making a fortune.

The town in which I lived was booming with new development, and Mr. Reedy's farm was a prime location for the 500 or so new homes that would eventually house new generations of families who would never know the joy of having a farm in their backyards.

Over the years, after the farm had long disappeared, along with other nearby farms, I lost touch with my desires to enjoy rural living. College, a burning desire to travel the globe, and “life,” crept up on me, and not until about four or five years ago did I have an epiphany: Real food is good, farming is honorable and life is empty when you don't feel connected to the land.

Of course, I'm also not a farmer. I don't work twelve-hour days, with calloused hands buried in the soil, hoping for good weather and enough customers to eek out a decent living. So I suppose its easy for me to wax poetic about the righteousness of farming.

But the truth is, it's getting harder and harder for farmers to get by.

Passion Pays

The USDA has just released its latest farm sector and household income report.

In this report, researchers have provided a forecast that suggests U.S. net farm income will fall by 21 percent this year. As well, production expenses are expected to rise by six percent, thereby solidifying a five-year run on increases.

Debt is also expected to rise by 3.1 percent, increasing more than assets for the first time since 2009. Apparently this is partly the result of less capital investment.

Yet interestingly, there still seems to be a movement of young farmers trying to make a go of living this kind of life. Some have suggested its naïveté, but I prefer to believe that its passion. Because quite frankly, no one's going to do this work unless he or she is passionate about it. After all, you don't get into farming to get rich. At least not in monetary terms.

Ethical Investing

Despite watching farm income plummet in 2014, I know for a fact there are a quite a few farmers making a decent living these days. Of course, these are also folks who honor the land, produce good food for people (not gas tanks), and farm responsibly.

These are your local farmers, providing us with grass-fed beef, pasture-raised chickens and pigs, and a plethora of nutrient-dense fruits and vegetables throughout the year. And these are folks who rely on consumers that prefer their nourishment come from real farmers, and not from industrial machines that churn out toxic slop on a daily basis.

These are the farmers that represent the future of real food and sustainability. And these are the farmers that ethical investors should back.

Certainly the best way to support these folks is simply by using your purchasing power. But you can also invest in these operations through Slow Money opportunities, where individual investors can invest in small, local farms, food processors and distributors. Most of these investments tend to be in the form of loans which offer returns of anywhere from zero percent to five percent.

I'm not saying you'll become a millionaire with Slow Money investing, but if you want to align some of your investments with your values, this is an excellent way to do it.

You can learn more about Slow Money opportunities here.