Farmland and Timberland: Top Performing, Uncorrelated Asset Classes Suitable for Inflation.

Historically, farmland and timberland have outperformed other major asset classes on a risk-adjusted basis, exhibited low/negative correlation, and provided inflation protection benefits.
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Farmland Market Drivers

2 Billion

World population increase by 20591

24%

Decline in the amount of arable land since 1950

879 Million Acres

Size of US farmland investible universe – equal to country roughly size of India2

$3 Billion

Dollars of annual funding dedicated to conservation3

Sources:
1
United Nations Department of Economic and Social Affairs, “World Population Prospects 2022: Summary of Results”, as of 2022.    
2 USDA, “Land Values: 2023 Summary,” as of August 2023
3 Conservation Resources research, as of November 2021

Timberland Characteristics and Return Drivers

Biological Growth and Land Appreciation

Forestry property values are enhanced by biological growth of trees, real increases in timber prices, and land appreciation.

Low Correlation to Other Asset Classes

Historically, forestry strategies have shown low correlation to equities and fixed income, as well as a positive correlation to inflation.

Tax Advantages

Forestry investing offers potential tax benefits through depletion and capital gains treatments.

Land Appreciation Rate

Forestry benefits from historic land appreciation of 4.65% per year.3