With access to an intricate network of rail, waterway, and roads, Ontario has developed a logistics system that caters well to the global marketplace. Positioned in the heart of the Great Lakes region, Southern Ontario provides farms with the infrastructure required to supply international commodity markets as well as local demand. From an economic standpoint, the province is also equipped with a financial system that enables the agricultural industry to invest in research, development, and innovation.
What is unique to Southern Ontario is the region’s ability to regulate its climate. While much of the Midwestern USA and Canada are exposed to climate change factors such as drought and temperature shift, the Great Lakes create a moderating influence on the local microclimate. Glacial till deposits in the region also afford SW Ontario with high-grade luvisolic soil, enabling high moisture and heat retention. From a geographical standpoint, the area is positioned at the same latitude as Northern California, the Mediterranean Sea, and Rome Italy- providing a high degree of sunlight and a lengthened growing season in comparison to the rest of Canada.
Global population growth, the shift toward more protein-rich diets amongst the middle class in China, India and other emerging economies, and the increased use of biofuels in North and South America, are driving a long-term trend of rising demand for agricultural commodities. Meanwhile, supply growth has been, and will continue to, be restrained by the shrinking area of arable land, by the slowing rate of productivity improvements driven by technology advancements, and to some extent, by climate change. Together, these fundamental trends have left our planet in a state whereby the consumption of agricultural goods exceeds production in the majority of years. This has been the case since the turn of the millennium, and remains the case today. Moreover, forecasters do not foresee a reversal of these trends. This backdrop sets the stage for the continued appreciation of the value of farmland globally, including the properties in Ontario that AGinvest targets.