Saskatchewan changing farm ownership laws

Food security is an area of increasing importance for many nations in light of concerns over fresh water availability, arable land, burgeoning populations and climate change – and that has caused the land market to heat up on a global scale.

According to a recent report by the Worldwatch Institute, land grabbing – the purchase or lease of agricultural land by foreign interests – is on the rise and threatens the food security of several nations. According to the institute, more than 36 million hectares around the world has been purchased or leased by foreign entities – mostly for agricultural use – an additional 15 million hectares is currently under negotiation.

“Today the FAO (Food and Agriculture Organization of the United Nations) reports that essentially no additional suitable agricultural land remains in a belt around much of the middle of the planet,” said Gary Gardner, a contributing author of the Worldwatch Institute’s State of the World 2015: Confronting Hidden Threats to Sustainability. “As a result, the largest grabbers of land are often countries that need additional resources to meet growing demands.”

The U.S. is the biggest player, accounting for seven million hectares of the global land purchases, followed by Malaysia. More than half of the land has been purchased in Africa in water-rich countries, but Indonesia and Papua New Guinea have also sold or leased larges masses of land. The Worldwatch Institute is concerned that some of the world’s most food insecure countries will be the ones most susceptible to accepting offers of purchase.

In Canada, each province legislates its rules for foreign ownership of farmland. Alberta, Saskatchewan, Manitoba and Quebec all limit foreign purchases, but Ontario and BC do not prohibit the practice at all. Alberta allows 20 acres, Saskatchewan up to 10 (with a 320-acre exception for entities that are partially foreign-owned, but controlled by Sask. corporations or residents), Manitoba allows up to 40, and Quebec allows no more than 10.

But Saskatchewan recently reviewed its farmland ownership rules under the Saskatchewan Farm Security Act, and regulatory changes were announced on October 20. The issue of farmland ownership eligibility in Saskatchewan is almost as hot a topic as whether to adhere to daylight savings time.

“Over the last few years there was a lot of anecdotal comments about foreign money buying land, but what precipitated the consultation was when the Canadian Pension Plan Investment Board bought over $140 million dollars worth of land from Assiniboia Capital,” said Chad MacPherson, general manager of the Saskatchewan Stock Growers Association.

The sale outraged many producers who already feel pushed out of the land market because of record high prices. The review included public consultation, and on October 7, the government released the results – there were more than 3,000 responses to the survey.

In 2002, the Act was changed to allow Canadian residents from outside of Saskatchewan to purchase farmland – a move that resulted in an influx of Alberta money buying Saskatchewan land. The only reason why the change was permitted was because of an impending charter challenge predicated upon the Canadian right to mobility. Since the review was announced, that reignited public discussion on whether an out of province limitation should be re-enacted. 

Trevor Harriot, a Regina-based author of several books about the prairie, and a self-described grassland conservationist, says part of the issue isn’t just about who is allowed to buy Saskatchewan land, but how it is managed.

“There’s land being purchased by Canadians, and sometimes new Canadians, who don’t perhaps have a farm or a ranching background, and they take up some kind of crop farming and they will sometimes just cultivate any native prairie that’s on their land,” he said. “It’s definitely a concern for us, whether you’re a rancher or a grassland conservationist. If you care about native grass being grass-side-up, then people are concerned about out of province ownership.”

Not all Saskatchewan producers want to limit land sales – especially the older demographic who want to be able to sell their land for the highest price possible before retiring. One of the bigger issues agriculture faces is how to replenish aging producers with young people who not only want to get into the industry, but have the money to gain a foothold.

Harriot says part of the problem isn’t that people from outside the province buy the land – it’s that they are not living on it, and may not be present to learn how to keep the land healthy.

“I worry about the loss of the generation-to-generation stewardship hand-off that we’ve had the benefit of for 100 years here. Ever since the days of open range ranching and onward after settlement and homesteading, we’ve had pretty good succession of stewardship from families that are really rooted in place,” he said. “But if we start to see that erode and break apart because of pressure from outside the province, and the marketplace and the global demand for land and food, then we are going to lose that hand-off of the wisdom and traditional knowledge of ranchers.”

Estimates put Saskatchewan’s remaining intact grasslands at a maximum of 20 per cent of what they once were, and Harriot says unless deeded land has an easement on it, there’s nothing to stop new owners from breaking it.

“I would like to see some kind of legal measures or regulations that would keep our large pieces of native rangeland under grass. That’s part of Canada’s food security too. We need to have a cattle herd in this country and it’s shrinking, even when beef prices are high, there’s fewer and fewer guys keeping cattle because the prices of land are being driven up.”

However, the changes do not limit farmland sales to other Canadians, but they do prohibit entities such as pension plans from buying land. Amendments include:

· Making pension plans, administrators of pension fund assets and trusts not eligible to buy farmland;

· Defining “having an interest in farmland” to include any type of interest or benefit (i.e. capital appreciation), either directly or indirectly, that is normally associated with ownership of the land; and

· When financing a purchase of farmland, all financing must be through a financial institution registered to do business in Canada, or a Canadian resident.

Enforcement of the Act and penalties for violating the Act will also be brought in when the changes are brought into law early in the New Year.

“Our government understands that to many in the province, farmland is not just an asset,” Agriculture Minister Lyle Stewart said.  “It is a connection to our history and who we are as people.  Farmers and ranchers want the opportunity to own the land they farm.”



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