Regardless of what you eat, agriculture affects everyone. Many people are far removed from where their food comes from, only seeing what is neatly packaged at the grocery store or served on a plate at a restaurant. However, everything we eat came from some variation of a farm, so it is important that these agricultural entities remain financially viable. Here are some trends in financing the agriculture industry. 

Funding of Environmentally-Friendly Practices

Many industries are thinking of ways to be more environmentally friendly, and the agriculture industry is no exception. Along with helping to maintain the health of the earth’s resources, eco-friendly practices come with financial benefits as well. For example, investing in more fuel-efficient tractors reduces fuel costs, which is a significant expense in any industry that uses heavy machinery or large vehicles. If a farm uses its own vehicles to transport crops or animals, it is in its best financial interest for those trucks to be energy efficient as well. 

Other ways that farms can be more sustainable include engaging in crop rotation and planting cover crops. This can affect financing because it may alter the amount of manpower needed to keep the farm viable. Hydroponics is yet another way that some growers are attempting to become more eco-friendly. Hydroponics involves cultivating plants in water rather than in soil, which many see as a more sustainable method of growing. However, the equipment needed for this is costly to initially set up. 

Funding for Different Farming Methods

People are becoming more health-conscious about their food choices and more aware of where their food comes from, as is evidenced by the increasing number of farm-to-table restaurants. Because of this, small and organic farms are increasingly seeking financing to remain competitive with industrial farms. Showing that these businesses can be just as viable as their larger counterparts should make it easier for them to obtain financing for their operations. There are microloans and other types of funding available specifically for small agricultural operations. 

Funding for Different Products

The legal landscape is also an important factor when it comes to financing what is grown on the land. For example, the 2018 Farm Bill in the United States made it legal to produce and consume certain hemp products. Due to this, industrial hemp production exploded and became an area within the industry that investors began to notice.  These trends, along with many others, affect how investors help finance the agriculture industry.