Fortune: Montana senator wants to ban Chinese ownership of U.S. farmland. The alleged spy balloon that floated over the state is giving his plan new life

by Nicholas Gordon

Senator Jon Tester (D-Mont.) is doubling down on his proposal to restrict foreign ownership of U.S. farmland, tying his decision to the alleged Chinese spy balloon that passed over his state last week. 

“People ought to be able to sell who they want to sell to, but not in this particular case, because China wants to do bad things to us,” Tester said on CBS’s Face the Nation on Sunday. 

Testor suggested that the ban would extend to Chinese private companies, saying “they’re all connected with the Communist Chinese government anyway.”

On Jan. 31, Tester and Senator Mike Rounds (R-S.D.) introduced a bill that would include the Secretary of Agriculture on the Committee on Foreign Investment in the United States (CFIUS), which examines the national security implications of potential foreign investments in the U.S.

“This is a ban against China, Russia, North Korea, and Iran, folks who don’t want to see us exist anymore as a nation,” Testor said on Sunday. “I don’t think they should have any opportunity to try to dictate our food supply.”

Tester has criticized the U.S. response to an alleged Chinese espionage balloon, which was first noticed over Montana. In a Senate hearing last week, Tester asked defense officials why “this baby wasn’t taken out long before.” The U.S. eventually shot down the balloon off the coast of South Carolina, a week after it first entered U.S. airspace. 

Chinese officials initially apologized for the balloon, claiming it was a “civilian airship” blown off course. Yet Beijing’s tone has hardened since the balloon was shot down, calling the U.S. military operation an “overreaction.”

The U.S. has shot down three more “flying objects” since then, most recently on Sunday evening as an “unidentified object” passed over Lake Huron. Officials have not shared details on the targeted objects. (Even China is now escalating its operations against unidentified flying objects, with local media suggesting the country might move against one object sighted around the city of Qingdao.)

Does China own U.S. farmland?

Foreign, and particular Chinese, involvement in U.S. agriculture is the latest flashpoint in relations between the two powers. Chinese entities owned less than 1% of privately held U.S. farmland as of the end of 2020, according to the Wall Street Journal.

Yet the total holdings by Chinese entities increased by four and a half times between 2010 and 2020. And Chinese investments in agribusiness are growing: in 2013, the Hong Kong–based WH Group purchased Smithfield, the world’s largest producer of pork. 

Last Tuesday, the North Dakota town of Grand Forks voted down a proposal by Chinese agribusiness company Fufeng Group to build a $700 million corn mill. The unanimous vote by the city council ends a monthslong tussle over the proposed factory, which would have been situated close to a U.S. Air Force base. 

Local officials, like Grand Forks mayor Brandon Bochenski, originally hailed the deal when it was agreed upon in November 2021. Yet residents and U.S. politicians said they were worried the mill could become a base for covert espionage against U.S. military operations.

CFIUS denied a request to examine the deal last December, citing a lack of jurisdiction. The U.S. Air Force stepped in instead, calling the potential mill “a significant threat to national security” in a letter to Senators John Hoeven (R-N.D.) and Kevin Cramer (R-N.D.). City officials like Bochenski cited the letter in their decision to halt the project.

Tester calls for ban on China buying U.S. farmland | Fortune