Farmland and agriculture ETFs

Top 5 Best Farmland And Agriculture ETFs In 2022

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With all of the interest surrounding farmland investing these days, you might be wondering how you too can get in on the action.

While there are a number of ways to get started, most options require a hefty capital reserve. This includes buying farmland outright with cash/financing or crowdfunding options with high minimum investments.

However, there are a couple methods that do not require high capital investments, though you can invest more if you desire.

These options are farmland ETFs and REITs.

In this article, we will be focusing on 5 different farmland agriculture ETFs and explaining what they are.

However, all of these investments are achieving exposure to agricultural commodities via futures contracts. As such, they are not recommended for beginners and are not meant for a long term investment. Since this is a derivative product, there is no real underlying asset. You don't own any actual land, farms etc.

What you are investing in is a fund that purchases futures contracts on agricultural commodities, giving you easier exposure. It is meant for a short term trade. If you are looking to own actual farmland, check out these farmland REITs.

The futures contract purchased by the fund will be sold to someone else who sells it to someone else and so on. A situation where you might use one of these ETFs is if you believed the price of corn was going to skyrocket in a week. Rather than buying futures contracts yourself, you could swing trade the Teucrium Corn Fund which owns corn futures.

Ok, let's dive right in and review these 5 farmland agriculture ETFs!

PlatformMinimumLinkAccredited OnlyInvestments
AcreTrader farmland investing platform$8,000+View InvestmentsYesUS Farmland, Timberland, Vineyards
FarmTogether farmland investing platform$15,000+View InvestmentsYesUS Farmland
farmfolio$30,000+View InvestmentsNoSouth American Farmland

1. Invesco DB Agriculture Fund (DBA)

This is by far the largest farmland ETF with $1.6 Billion in assets under management. 

DBA allows you to gain exposure to agricultural commodities. The fund invests in a large mix of different natural agricultural resources.

However, the fund is designed more so for short term exposure and not a longer term buy and hold investment.

This fund seeks to track the Diversified Agricultural Index Excess Return in addition to interest income from bond investments the fund makes with excess capital.

The goal of this fund is to give investors easy exposure to commodity futures. Since this fund invests in futures, it is not suitable for all investors due to the risks associated with the derivatives market.

2. Teucrium Corn Fund (CORN)

For those looking to gain exposure to corn futures in an easy manner, that is exactly what this fund was designed for.

CORN tracks as closely as possible the daily changes in the price of corn for future delivery.

Under normal market conditions, the fund remains 100% invested in Benchmark Component Futures Contracts as well as cash and equivalent investments.

This fund has a total of $200 Million in total assets. 

Since this fund invests in futures, it is not suitable for all investors due to the risks associated with the derivatives market.

3. Teucrium Wheat Fund (WEAT)

This fund is almost identical in nature to CORN, with the exception being that the underlying commodity being tracked is wheat.

Just like before, this exposure is accomplished via futures contracts, exposing investors to the risks associated with the derivatives market.

This fund has a total of $366 Million in total assets. 

4. Teucrium Soybean Fund (SOYB)

Soybeans are one of the most common agricultural commodities today.

SOYB tracks an index of soybean futures contracts. It reflects the performance of soybeans.

Since exposure is achieved via futures contract, this is not meant to be a buy and hold investment. Instead, it is meant for short term trades related to the price of soybeans.

This fund has a total of $67 Million in total assets.

5. Teucrium Agricultural Fund (TAGS)

If you want a blend of exposure to different commodities, this fund accomplishes exactly that.

TAGS seeks to provide short term exposure to the combined daily performance of these four separate Teucrium commodity pools:

  1. Corn Fund
  2. Soybean Fund
  3. Wheat Fund
  4. Sugar Fund 

Keep in mind, the underlying funds are achieving this exposure via futures contracts.

This fund has a total of $46 Million in total assets. 

Farmland Agriculture ETFs: Final Thoughts

There are many ways to add farmland or agriculture to your investment portfolio. This includes purchasing a farm outright, participating in a crowdfunding platform, or buying ETFs and REITs.

While these ETFs are suitable for advanced traders looking to capitalize on short term price movements in commodities, they are not ideal for long term investments or beginners.

The key benefit with these ETFs is exposure to farmland yields without a high minimum investment. Because they are futures contracts, there are a few risks to be aware of.

First and foremost, the basic premise with a futures contract is the belief that the price will go up in the future. An investor locks in the price today hoping for a gain tomorrow. So, should the price go down due to any market condition, you are at risk. Other risks include leverage, interest rates, and liquidity.

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