Making and unmaking an “asset class”

Land grab protests at the Euro Finance Week in Frankfurt 2013. Source: Ouma 2013.

Central to the assetization of farming is the globally distributed effort to bestow it with a legitimate financial worth. Although many financial actors paint the picture that farmland has an absolute or intrinsic value and that this value can be “unlocked”, my research demonstrates that farmland gains its financial worth only through collective yet contested practices of classification, valuation, and valorization. This process has an internal dimension (related to the financial industry) and an external dimension (related to “society”). Within the finance industry, this involves its positioning of farmland as an “asset” in the relational investment universe of the world of money management: agriculture becomes a legitimate asset class only if it can be meaningfully set in relation to other asset classes, and if the underlying “assets” generate legitimate returns for investors. Assetization involves the production of a specific form of financial knowledge about the world of farming through which its social, material, and temporal qualities are aligned with the moral conventions governing the money management industry.

Furthermore, the legitimization of “agriculture as an asset class” has been thwarted by external forces such as NGOs. Their well-publicized accusations of the immorality (i.e., speculation, land grabbing) of finance-gone-farming have become major reputational risks for institutional investors. Take for instance this investment conference taking place in Frankfurt in 2013, where actual and would-be investors in farmland were welcomed by activists forming a “corridor of shame”, or the reports of German teachers finding out that their pension provider had invested in a “land grab deal” in Brazil.

This notwithstanding, “capital” and its enablers have worked hard to overcome these internal and external barriers to accumulation. Ultimately, the research presented here allows us to problematize the often-invisible morality of finance, which is as much about “value” as it is about “values”.

(Ouma 2020: 93-95)