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Profitable Investments In Canada – But one of Canada’s greatest assets is its land, an abundance that supports a thriving agricultural base. In Canada, about 675,000 square kilometers of land is devoted to agriculture alone.
From sun-kissed cornfields to lush orchards to summer harvests in the valleys, Canada’s farmland abounds.
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Canada has deep wells of natural water sources and has even benefited from climate change that has lengthened growing seasons and supported higher value crops.
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Canada has a strong history of farmland appreciation, driven by two factors that will continue to operate: trends in physical yield growth and the ability to grow more profitable crops.
Farmers know their biggest challenge is access to capital. They have to replace old equipment, build the property, buy seeds, build irrigation systems, pay for harvesting labor.
When money is sent to farm land, the results can be amazing. Land can be used better, crops will grow and income will be higher.
Since the early 1990s, cultivated land has shown profits every year. The USDA says the average annual yield on farmland is 11.5%. Look at its track record and you’ll see that farmland outperforms all other asset classes, including real estate.
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Investors also get other benefits along with these which are above average. Agricultural land has been found to have low returns compared to other assets such as US Treasuries.
Also, farm returns are unlikely to change with the ebbs and flows of the stock market. This type of land has been known to thrive even in years when the market is down.
As the world’s population continues to drop off the charts, there are more and more hungry mouths to feed. This means that worldwide demand for food resources, including grains from wheat to corn to apples, will continue to increase.
In conclusion, farmland is a solid investment and the demand for agricultural products will only increase in the coming decades.
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So, you have decided that you need to get involved and participate in the cultivation of farmland. But buying a farm isn’t exactly what you have in mind. Unlike stocks, ETFs, and mutual funds, farmland isn’t something you just buy through a brokerage account.
In this article, we will highlight 3 platforms that allow investors to participate in the cultivation of farmland without leaving home!
AGinvest Farmland Funds was established to raise capital and acquire, optimize and manage Ontario’s highest quality agricultural land. AGinvest works with progressive farm operators under a grower agreement to generate reliable annual income.
AGinvest’s founders come from a farming background and use this practical knowledge in all aspects of the company.
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Area One Farms manages private equity funds in the Canadian farmland sector. They work with established farm operators to buy farmland off-market, helping family farms expand physically while also improving their financial returns. In Canada’s unique model, profits and gains are shared equally between the farmer and the investors.
Joelle Faulkner, founder and CEO of Area One Farms, is a multi-generational Canadian farmer. The Faulkner family owns and operates London Dairy Farms, London Dairy Supply, London Dairy International, ProRich Seeds and Sequin Farms.
The Toronto-headquartered company has $450 million USD in committed and invested capital and is currently completing its fourth round of funding, none of which have reached a 10-year investment period. The company currently has 24 farm partners in Ontario, Manitoba, Saskatchewan and Alberta.
The company’s mission is to invest in farmland in the most sustainable way possible, focusing on added value. They accomplish this mission through equity partnerships with Canada’s best farmers.
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The company brings together committed investors and innovative farmers to invest in land and grow farms in a farmer-owned way.
Area One Farms works with Canadian farmers, most of whom are family farms, who are looking to expand. Often they find adjacent properties for sale, perhaps owned by retiring farmers. The found company helps the farmer buy the land. Investors will become equity owners of the new, expanded farm.
The annual source of income for investors is farm produce such as corn, oats, barley, soybeans and other crops. The platform helps pay the farm’s expenses and then distributes the profits to investors.
An important part of generating income is improving the value of the land so that the land is worth more than the money invested in it.
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Area One investors join a network of farm partners, suppliers and vendors, and agricultural researchers dedicated to helping increase farm profitability.
The company also cares about the environment. They continue to invest only in areas that are 100% water sustainable and in farmers who consciously make good environmental decisions.
Bonnefield was founded to be a financial partner to progressive farmers. Investors provide farming families with an alternative source of capital to lend money to grow their farming business. In return, investors will receive uncorrelated, low-volatility, equity-like returns. Currently, the company manages 1 billion
Bonnefield is Canada’s leading provider of land lease financing to farmers committed to preserving farmland across Canada. They partner with forward-thinking farm operators who embrace technology and recognize farming as a business and a way of life, and are interested in long-term working relationships.
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Bonnefield has successfully assisted over 100 farming families where they work through their lease financing program. Since 2009 Bonnefield has been building long-term financial partnerships with Canadian farmers to help them grow, reduce debt and implement retirement and succession plans, while protecting Canadian farmland for farming.
The company invests in and manages farmland for long-term capital appreciation and income. It offers qualified investors the opportunity to own Canadian agricultural land through an incorporated limited partnership.
Over the past ten years, Bonnefield has experienced tremendous interest from the investment community in agriculture and farmland as an asset class. In addition to the large, sophisticated institutional investors around the world who are valuing or already investing in agricultural land and agricultural investments, non-institutional investors are also on the rise. (An institutional investor is a group that pools money to buy securities, real estate, and other investment assets. Institutional investors include banks, insurance companies, pension funds , hedge funds, REITs, investment advisors, foundations, and mutual funds.)
Agriculture is a thriving cornerstone of Canada’s economy. in 2018 there were nearly 270,000 jobs in agriculture. Canada is the largest exporter of agricultural products in the world. The value of this export in 2018 was more than 60 billion
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Canada’s top agricultural products include canola, beef and veal, vegetables, grains and poultry. Canadian companies export crops, meat, maple syrup and hundreds of other food-related products.
For investors, farmland is a smart addition to a diversified portfolio. Farms are tangible assets that do not gain or lose value with the ups and downs of the stock market. They are a great way to generate income, whether it’s through increased land values or annual crop yields.
For decades, farmland has proven to be a wise investment far superior to any other real estate. Historically, it never loses its value. It’s a win-win for farming families and investors. The content on this site contains links to our partners and we may receive compensation when you sign up at no cost to you. This may affect which products or services we write about and where and how they appear on the website. This does not affect the objectivity of our ratings or reviews. Read our announcement.
Have you noticed how companies focus on ESG in their corporate updates? ESG, or environmental, social and governance, has become a key factor in how investors view companies.
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Although ESG does not always have a direct impact on their business, it is more than a new corporate standard that companies follow. Companies with strong ESG policies are of particular interest to socially conscious investors.
Due to the current global transition to renewable energy and climate awareness, environmental policy has become an important part of corporate operations. Carbon neutrality has become a necessary short-term goal for almost every company around the world.
Like any type of investment, ESG investing has both advantages and disadvantages. On the one hand, investing in a company with strong principles gives investors the peace of mind that their money is doing good for the world.
On the other hand, too much focus on ESG can distract you from things like company performance and growth. As always, research each company and develop an investment strategy that works for you.
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In this article, I will review the 10 best ESG ETFs in Canada for 2023. Here are the ten ETFs I will discuss for those looking to get involved in ethical investing in Canada:
This Blackrock iShares ESG ETF is relatively new, having only been established in 2019. This ETF trades on the Toronto Stock Exchange and pays a quarterly dividend of 3.47%.
XESG focuses on holding Canadian blue-chip stocks with a strong ESG policy.
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