Our top picks for the most profitable crops in high demand around the world.
As an investor, agriculture may not be on your radar, but incorporating farmland growing plants and crops into your investment portfolio means adding an asset with considerable upsides and relatively low risk compared to more traditional investments. That said, not all cash crops produce the same levels of profit, and some require more due diligence than others to find the most profitable crop with the minimal investment. The answer to the question of what crop makes the most money can have multiple answers, and overall it’s important to understand what which crops are worth investing in and which are best avoided.
Four High-Value Growth Crops
Here are our top picks for money-making crops:
While all citrus fruits, including lemons, tangerines, and oranges, represent a potentially lucrative investment and established growing sector, limes edge out the others for a few reasons and is considered to be one of the most profitable crops per pound.
The demand for limes is year-round with eager buyers lining up to buy this excellent crop from both large and small farms, but there are some seasonal gaps in production that offer an opening for additional suppliers. Mexico produces limes for the United States, and Brazil produces for Europe. Egypt, Vietnam, and China are attempting to fill in the gaps when limes are not in season in Mexico and Brazil, but it is ultimately Colombia with its unique climate (including mild winters) and strategic shipping location that makes it well-suited for year-round lime production.
Lime exports from Colombia are growing at a rate of about 20 percent per year, and because the country is closer to the U.S. than Egyptian and Asian lime producers, it’s better positioned to export its lime crops to the American market. Colombian lime farms represent a promising investment opportunity for those looking to buy farmland in Latin America and they are forecasted to be a very lucrative cash crop per pound for years to come.
Learn more: Limes 101: A Guide for Investors
Coconut boasts almost unparalleled value-added potential, and this profitable crop has a number of sectors that are found in grocery stores that are growing at staggering rates. In the U.S. market, coconut water is forecasted to grow at a CAGR of 14 percent over the next six years, with coconut oil and essential oil projected to increase 5.1 percent through 2030 and coconut milk expected to see 17.1 percent growth through 2027.
Despite this growth in demand for one of the best cash crops, there hasn’t been a corresponding boost in coconut production, leading to serious supply chain issues—and leaving plenty of room for new providers. In fact, many smaller land owners with very little space are switching to other small farm crops, such as palm oil, driven by environmental damage and government subsidies.
When economies of scale kick in, coconut farming is much more lucrative and a compelling long-term investment that can be one of the most profitable crops to grow. Vietnam, the Ivory Coast, and Colombia all have ideal conditions for growing coconuts, and volume per pound is increasing in all three of these countries. As with lime production, Colombia is particularly well-suited for growing coconuts due to its temperate climate with mild winters and export capabilities given its proximity to high-demand markets. Coconut is poised to thrive here as one of the most profitable crops to grow with numerous medicinally potent health benefits for consumers.
Avocados have been increasing in popularity for years, and this profitable crop shows no signs of slowing down. As health experts sing the fruit’s praises, health-conscious consumers see major health benefits and have responded with growing demand and increased per pound consumption, particularly for the popular Hass variety of this valuable crop. The global avocado market is expected to grow at a CAGR of 4.8 percent through 2025, and the Asian market is expanding even faster, with imports set to increase 10 percent in Japan and 32 percent in South Korea.
The U.S. is the world’s largest importer of avocados, and the crop sells not only because of the fruit’s reputation as a nutritional powerhouse but also because the country has a deeply-rooted Mexican food tradition and a large Latino population. Food producers see avocados as one of the most profitable crops as consumers are willing to pay for it at both their local farmer’s markets and major supermarket chains.
Mexico currently supplies 88 percent of imported avocados to the U.S., but the country is facing rising competition from Chile, South Africa, and Colombia. In fact, Colombia alone has increased its export value a whopping 600 percent over the past five years, with even more massive growth expected, making it one of the high value crops with the potential to be one of the most profitable crops to farm per acre.
The tropical mango might just be one of the world’s favorite fruits and most lucrative crops to grow —and the numbers back this up. The total export value of mangos has increased 60 percent over the past five years, reaching over $3.5 billion in 2019. As with coconuts, there are various value-added opportunities and processed goods made with mango, ranging from salsas to smoothies and ice cream, even placed in cubes atop leafy green salads, making this a solid investment choice and one of the most profitable crops to grow.
The U.S. and China are the two top importers of mangos in the world, with the U.S. consuming more processed mango products and the Chinese market buying more fresh mango. Thailand is the leading global exporter of this fruit, with its exports growing over 200 percent during the past five years. The bulk of Thailand’s production is sent to the Chinese market.
Mexico ranks as the second-biggest exporter of mangos, with much of its production going to the U.S. market. But there’s room for more producers as the demand for mangos continues to climb. Vietnam, Colombia, South Africa, and India have all increased production to meet this heightened demand.
Learn more: 3 High-Value Tree Crops (And Why to Invest)
Crops to Avoid
While limes, mangos, coconuts, and avocados represent the most promising crops in terms of making a profit, there are also crops that are less lucrative and present more risk from an investment standpoint:
Coffee was once considered a good opportunity in emerging markets, but rising temperatures have led to an increase in diseases that are wiping out crops. The coffee market is also subject to price swings, and coffee plantations as well as small farm areas are often located in remote areas that are not easily accessible and are located in countries with economic and political tumult.
In addition, the coffee market is highly consolidated, with 80 percent of global sales attributed to only three multinational corporations. For growers, this lack of competition translates to low profits. In fact, 61 percent of growers are selling their coffee beans for less than the price of production making it one of the least profitable crops for many growers. The average farmer’s income per acre has remained stagnant during the past two decades—or even declined once rising production costs are factored in.
While Fair Trade coffee holds promise for growers, certification involves meeting strict standards, which is why only about 2 percent of the global coffee market is currently Fair Trade. ESG (Environmental, Social, and Governance) investors who want to ensure fair wages and sustainable coffee production may have difficulty seeing a return on their investment in the current environment.
Soybeans are a popular commodity crop in the United States, and worldwide production has increased dramatically over the past 70 years. Soybeans are used not only as a protein source for humans and animals but also for vegetable oil and industrial products.
In contrast to tree crops (like limes and coconuts), soybeans are a row crop, which means they must be replanted each season. This requires expensive machinery and labor. The practice also depletes soil quickly, requiring crop rotation or resting periods. To allow for rotation or rest, a large amount of land is needed for this type of farming and adding uncertainty to its ability to be one of the cash crops worth a long term investment per acre.
Investing in soybean farming in the U.S. is a risky proposition, with climate change causing decreased yields and environmental concerns impacting farmers. In addition, the costs of land, equipment, and labor are all higher in the U.S.
Furthermore, the recent “trade war” with China has hit the soybean market hard. Historically, China purchased 70 percent of North Dakota’s soybeans. And when the country ceased buying agricultural products from the U.S., soybean farmers were devastated, making the average price difficult to sustain and likely one of the less profitable crops for small farms.
The Bottom Line
Limes, coconuts, mangos, and avocados are some of the most profitable crops for agricultural investment, and Colombia in particular is poised as the best location for growing each of these fruits. Soybeans and coffee are other crops that are riskier investments that are not as likely to see as high of a return.
In our Agricultural Investment Guide 2022, you’ll find not only more information about choosing the right profitable crops to grow and how to own them in a way that requires minimal investment in time, but you’ll also get a comprehensive guide to farmland investment, including trends in specialty crops, how to identify the most profitable plants per acre, location profiles, and risk assessments.
Download our free guide today to learn more.