Executive Summary

Management overview of the fund’s business strategy
Operations and latest crop/harvest results
Financial performance and pro forma projections

If you have not yet read Part 1: The Future Of Better Farming, available free to all readers, please click here to read it first.

Farmland LP owns and operates two farmland funds. Fund I is a limited partnership and is closed to new investors. Fund II is a private REIT and is open to interested accredited investors.

Having just celebrated its 10-year anniversary, Farmland LP now manages over 15,000 acres across Fund I and Fund II, with farms based in Oregon, California (Fund I), and Walla Walla, Washington (Fund II).

As an organic and sustainable farmland manager, Farmland LP has now grown to be one of the top 0.4% of all U.S. farms by revenue according to the USDA. This scale helps with their mission to demonstrate that sustainable agriculture is more profitable than commodity agriculture, as scale also correlates with profitability in agriculture.

For their latest annual report:

Our core strategy of adding value to farmland using sustainable agriculture best-practices has been consistent since we started in 2009, and over the years we have learned a few things that continue to improve and refine what we do.

Sustainable, organic agriculture continues to prove itself and deliver benefits. On the agronomic side, our organic conversion processes show reduced weed pressure, enhance soil quality, and improved water-holding capacity. On the pricing side, organic pricing is superior to commodity pricing.

Converting annual crops to long-lived crops such as perennial seed crops, and permanent crops such as vineyards and blueberries, delivers both good investment returns and improved sustainability benefits due to reduced soil tillage, better water use, and the addition of permanent pollinator habitat.

With current low livestock and forage prices we have reduced the ratio of land in pasture while creating similar or better soil benefits using seed and cover crops. Our farmers have been impressed with the soil quality after cover crop conversions due to high organic matter and less soil compaction.

Large buyers of organic crops are attracted to our scale and we are establishing good credibility with them in delivering high quality food. This is paying off with a growing number of larger contracts.

Crop insurance for organics is becoming a viable risk management product, similar to how it is used in the Midwest for conventional corn and soy. Historically we have had some crop losses due to weather, and with the new pricing we see the potential to lock in profits on high value crops, or plant high-value, higher risk crops with insurance rather than plant low risk but lower-value crops.

What we do is more complex than most farms, and our size allows us to attract some of the best people, and also gives us access to some pretty impressive technology as well. Some of it is amazing, like the near-daily satellite imagery, and some is important but less exciting such as accounting and operations management, but it is all helping us continually improve how we steward the land and enhance the performance of the fund.

The video below is the full management presentation from Fund I’s recent investor update:

There’s a separate similar video update for Fund II, which the fund’s management can make available to interested investors upon request.

If you’re an accredited investor and find yourself interested in learning more about how to participate in the Farmland LP family of funds, you can contact the management team directly for more information by clicking here.

IMPORTANT NOTE: This is NOT personal financial advice. The above information is shared for education purposes only.

As always, we recommend working with a professional financial adviser to build an investment plan customized to your own needs and objectives.

Suffice it to say, any investment ideas sparked by this report and/or video should be reviewed with your financial adviser before taking any action.

Are we being excessively repetitive here in order to drive this point home? Good…

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