Chinese investors have purchased nearly 400,000 acres of American land, raising government officials’ concerns about the communist nation’s intent and long-term strategy.
More than 80% of the land held by Chinese entities is owned by Smithfield Foods and billionaire Sun Guangxin, a former People’s Liberation Army captain who created controversy by buying 140,000 acres in Texas. Chinese investors have also acquired significant land holdings in California, Utah, Florida, and other states.
Chinese entities held more than 383,000 acres as of two years ago, according to a report from the United States Department of Agriculture, constituting less than 1% of foreign-held farmland. Some 195,000 of those acres were owned by a few dozen Chinese investors, while the remaining 189,000 acres were held by American corporations with Chinese shareholders. While the ownership increased steadily between 2015 and 2019, it saw a 30% increase from 247,000 acres in 2019 to around 352,000 acres in 2020, according to an analysis from Forbes.
At a broader level, foreign holdings of agricultural land doubled between 2009 and 2019, representing 3.1% of private farmland in the United States.
Entities in allied countries such as Canada, the Netherlands, Italy, the United Kingdom, and Germany hold the greatest shares of foreign-owned farmland. Federal agencies have nevertheless indicated that even a little bit of farmland held by Chinese investors is too dangerous.
The Air Force, for example, warned Congress earlier this year about plans from chemical manufacturing company Fufeng Group to acquire land outside of Grand Forks Air Force Base in North Dakota. Air Force Assistant Secretary Andrew Hunter said in a letter to Sen. John Hoeven (R-ND) that “the proposed project presents a significant threat to national security with both near and long-term risks of significant impacts to our operations in the area.” Former National Security Advisor H.R. McMaster has also contended that land purchases from Chinese entities are part of a strategy involving “co-option, coercion, and concealment.”
Regulations vary but many state governments, as well as both parties in Congress, have pushed laws resisting Chinese investment in American land and foreign purchases more generally. Rep. Dan Newhouse (R-WA), one of the lawmakers who called for such legislation, recently remarked that “food security is literally national security.”
Fufeng’s subsidiary in the United States reportedly denied the existence of any national security threat, noting that it was a publicly traded company unaffiliated with the Chinese government. While it’s true much of the land is owned by Chinese investors rather than the nation’s government, concerns have been raised about the extent to which the Chinese Communist Party controls purportedly private businesses.
It is in the Chinese government’s explicit interest for its investors to acquire foreign farmland as well. The Agriculture Department’s Economic Research Service noted five years ago that the Chinese Communist Party’s strategic statements showed an interest in fostering “large, internationally competitive grain-trading and agricultural business conglomerates.”
It isn’t just government officials resisting China either. Residents of a small Michigan township have reportedly been speaking out against an electric vehicle battery plant approved by local officials. Set to open near another military base, the plant comes from Gotion, whose parent company Guoxuan High-Tech is based in Beijing and recently bought land near Grand Rapids.
The company owned by Sun has meanwhile bought land in the same Texas county where Laughlin Air Force Base is located for a wind farm.
Those two projects raise questions over Chinese impacts on American energy security as the latter nation pursues a rapid transition to renewables. Sun’s wind turbines could serve as support for Texas’ strained electric grid. The United States as a whole is reportedly encountering difficulties powering renewable projects even as it sets ambitious goals for technology like electric cars.
Although legislation prohibiting Chinese land purchases has found support among lawmakers, some have opposed those types of measures as xenophobic. Yan Bennett, the assistant director of the Center on Contemporary China at Princeton University, said in an interview with CNN that “not every land purchase by a foreign government or national is a security threat, so we need to make sure that we distinguish those purchases from those that are actual threats.”
The Justice Department meanwhile asked a federal judge to halt a law in Florida which prevents individuals from China, Russia, Iran, and other hostile nations from owning land in the state. The agency argued that the “unlawful provisions will cause serious harm to people simply because of their national origin, contravene federal civil rights laws, undermine constitutional rights, and will not advance the state’s purported goal of increasing public safety.” China’s foreign ministry has responded to restrictive laws by describing Sino-American trade as “mutually beneficial.”
