As the world's arable land dries up. Canada's fertile fields are fuelling an unlikely partnership between North America's largest corporate farming operation and prairies First Nations.
As the population expands, the need for agricultural land is driving investment in what could be the future’s most precious resource: soil.
According to the Intergovernmental Panel on Climate Change, arable land on Earth will diminish by 30 to 50 per cent over the next century. That’s a lot when you consider that a mere 11 percent of total land area is arable. Even more daunting when pitted against a global population that is predicted to reach 9 billion by 2050.
This year in Saskatchewan, a corporation called One Earth Farms emerged with plans to lease upwards of one million acres of First Nations’ land for agricultural use. If successful, it will become the largest farm on the continent, and potentially the world, giving First Nations communities a definitive role in the management of one of our planet’s largest swaths of arable land.
Globally, the increasing scarcity of arable land has prompted companies from China, South Korea, and many of the OPEC nations to buy up land in breadbasket regions of Africa and Southeast Asia to secure a financial future in food. These acquisitions have often been accompanied by conflict. In Madagascar, for example, Daewoo’s negotiations for 1.3 million hectares of palm oil plantations reportedly fueled political conflicts that led to the overthrow of the government in March of 2009.
Unlike many foreign investors in large-scale agriculture projects in the developing world, One Earth has set up an inclusive board of directors with strong First Nations representation in management. In addition, it offers company equity to landowners involved in the project. For many, One Earth Farms marks the First Nations community’s reclamation of agricultural land in North America. For others, it is viewed as another step in the corporatization of Canadian farmland.
In the spring of 2009, Eric Sprott, billionaire, financier, and CEO of Sprott Inc., shifted his investments into agriculture. Sprott Resource Corporation, headed by Sprott’s protégé Kevin Bambrough, is the sole financial backer of One Earth Farms and has invested $27.5 million in the company. I sat down with Bambrough at the Sprott headquarters to talk about the project. For Bambrough, wealth preservation is only achievable through investment in resources.
“We are coming into a time in history where paper money is at an incredible risk of being devalued,” he says, leaning back in his chair. “You have to forget about the novel value of things, and you have to start looking at the relationship that real things have to each other.”
Appropriately, our conversation is taking place in Sprott’s “Money Room”, where framed paper money - including a Zimbabwean 100 trillion dollar bill - adorns the walls, and a coffee table full of antique coins supports our glasses of sparkling water. In here, money serves a purely decorative purpose.
Resource investments have driven the economic success of Sprott Resource Corp., which reported net profit of $134.2 million in fiscal 2008. In the past, Sprott has focused on energy and mineral resources, investing in Waseca Energy, PBS Coals, and Stonegate Agricom.
Bambrough’s quest for resources led him to Blaine Favel, an MBA graduate of Harvard’s School of Business, and former Grand Chief of the Federation of Saskatchewan Indian Nations (FSIN). Favel was intent on creating a responsible business model for resource development on First Nations land that would include First Nations stakeholders every step of the way.
“I tried to design a company, with the strong support of Sprott Corporation, that would be respectful of Indian people,” Favel says. “The whole mandate was designed on improving their quality of life over the long term.”