Farmland loans for regenerative agriculture: FBN and Walton family launch ‘first-of-its-kind’ lending program

As rising costs and regulatory uncertainty challenge farmers’ efforts to adopt regenerative agriculture practices, an innovative new pilot with support from the Walton family looks to help finance the transition through discounts in private conservation loans.

Led by agriculture e-commerce marketplace Farmers Business Network, the Regenerative Agriculture Financing Land Loan pilot program offers discounted interest rates on land loans for farms who successfully adopt conservation practices benefiting soil health, water quality and overall climate resilience.

The loans are made possible through a $750,000 investment from the Walton Family Foundation, the philanthropic arm of Walmart founders Sam and Helen Walton.

“Helping farmers to grow crops while also protecting water and soil is key to protecting people and nature together,” Moira Mcdonald, environmental program director of the Walton Family Foundation, said in a statement, adding that the program will “provide farmers with access to affordable capital in order to incentivize the adoption of sustainable agricultural practices.”

The pilot program is expected to serve about 20 farmers as a “proof of concept” with hopes of expansion down the line, Dan English, general manager of FBN Financial, said in an interview with Agriculture Dive.

To access the discounts, farmers must implement sustainable soil and water health practices and meet environmental criteria developed by Environmental Defense Fund and Gradable, a sustainable grain platform co-owned by FBN and ADM.

Eligible farmers will receive discounted interest rates — ranging from 0.25% to 0.5% — on newly financed land for seven years. The loans can be used to acquire or refinance land, English said, providing savings of around $5,000 to $6,000 a year.

The regenerative land loans build on the overwhelming demand for FBN’s sustainable financing program that provides operating loans to farms that implement regenerative practices. The operating loan program, launched as a pilot with the Environmental Defense Fund in 2021, has grown to support 140 farmers in 2024.

Private companies and partnerships could play more of a role in spurring adoption of regenerative agriculture, particularly amid a downturn in the farm economy and ongoing uncertainty around federal climate funding. There is demand among farmers to transition to regenerative practices, English said, but the sector needs “long term” investment.