word listings Common Farmfolio and Agribusiness Concepts
Accredited Investor An accredited investor is a term used by the U.S. Securities and Exchange Commission (SEC) under Rule 501 of Regulation D.
Acidic soils The degree of acidity (or "sourness") in the soil, is expressed as a number within a pH scale, running from 0 to 14. pH is the concentration of hydrogen (H) ions -- the more hydrogen ions there are, the more acid the soil is. Below 7 is considered to be acidic while above 7 is alkaline. Although plants prefer different levels of pH, if a soil is too acidic it, plants cannot take up nutrients such as N, P and K. Most nutrients that plants need are readily available when the pH of the soil solution ranges from 6.0 to 7.5. Agricultural involution increasing productivity in terms of output per area (land productivity) but not increasing labour productivity (output per labourer).
Active farmer To avoid granting aid to individuals and companies whose agricultural activity is marginal, direct payments are paid only to ʽactive farmers.ʼ For instance, an individual who operates an airport, a railway service, waterworks, real estate service, a sports ground or a recreation facility, is in principle not considered an active farmer unless he/she proves that farming is not a marginal activity.
Administrative burden Administrative activities that farmers and administrations conduct only because of legal obligations and which add no real value to their work.
Advanced biofuel An advanced biofuel is produced by advanced technology using all parts of the crop or from non-food feedstocks (e.g. wastes, agricultural and forestry residues, dedicated energy crops). The end product (advanced bioethanol or advanced biodiesel) is the same as that produced by first generation technology. The term ʽadvanced biofuelʼ is synonymous with the term ʽsecond generation biofuelʼ.
Adverse climatic event Weather conditions, such as frost, storms and hail, ice, heavy rain or severe drought, which can be considered to be a natural disaster.
Advisory services These are services intended to assist farmers (as well as forest holders and small and medium enterprises in rural areas) to improve the economic and environmental performance of their holdings. These services provide tailor-made advice, taking into consideration the specificities of the farm, to contribute to the sustainability and climate friendliness of the holding. The scope of the advice covers any economic, environmental and social aspect that a beneficiary may need to develop his or her activity.
Afforestation This is the planting of trees for the purpose of creating woodland or forest.
Agribusiness A way of farming that combines agriculture and business and usually involves large amounts of land, animals, and expensive technology be.
Agricultural activity The 2013 reform of the Common Agricultural Policy introduced the stipulation that, for the purpose of receiving direct payments, farmers shall have an agricultural activity which means: • the production, rearing or growing of agricultural products including harvesting, milking, breeding animals and keeping animals for farming purposes; or • maintaining the agricultural area in a state which makes it suitable for grazing or cultivation without any particular preparatory action going beyond usual agricultural methods and machinery based on criteria to be defined by member states on the basis of a framework established by the Commission; or • carrying out a minimum activity to be established by member states on agricultural areas naturally kept in a state suitable for grazing or cultivation.
Agricultural area Any area taken up by arable land, permanent grassland or permanent crops.
Agro-ecosystem Agro-ecosystems are about the interactions between all living and non-living components at farm level and in the surrounding landscape.
Agro-industry Industrial sector that processes agricultural products.
Agrobiodiversity The variety and variability of animals, plants and micro-organisms that are used directly or indirectly for food and agriculture, including crops, livestock, forestry and fisheries. It comprises the diversity of genetic resources (varieties, breeds) and species used for food, fodder, fibre, fuel and pharmaceuticals. It also includes the diversity of non-harvested species that support production (soil micro-organisms, predators, pollinators), and those in the wider environment that support agro-ecosystems (agricultural, pastoral, forest and aquatic) as well as the diversity of agroecosystems (FAO, 1999).
Agroecology The term agroecologia originates from Latin America, and refers to the holistic study of agroecosystems, including environmental and human elements. Its goal is to integrate components so that biological efficiency is improved, biodiversity is preserved and the agroecosystem productivity and its self-regulating capacity are maintained. This term is used in Latin America for what the rest of the world refers to as organic agriculture – in Latin America, organic agriculture is specifically linked to a particular system of certification. (For more information and literature links, see the Agroecology in Action website at: www.agroeco.org).
Agroforestry This basically refers to "trees on farm". It is the collective name for land-management systems that optimise the economic and ecological benefits created when trees and/or shrubs are integrated with crops and/or livestock. (For more information and links to resources, see the website for the World Agroforestry Centre, at: www.worldagroforestry.orgAlso see LEISA Magazine issue on Trees and Farmers (1990))
Agrofuels See Biofuels.
Alkaline soils The degree of alkalinity (or “sweetness”) in the soil, is expressed as a number within a pH scale, running from 0 to 14. pH is the concentration of hydrogen (H) ions -- the less hydrogen ions there are, the more alkaline the soil is. Above 7 is considered to be alkaline while below 7 is acid. Although plants prefer different levels of pH, if a soil is too alkaline, nutrients such as iron (Fe), manganese (Mg), and phosphorus (P) are less available. Most nutrients that plants need are readily available when the pH of the soil solution ranges from 6.0 to 7.5.
Amino acids Building blocks for proteins.
Amortization As opposed to an interest-only loan in which each repayment installment consists only of interest payments with a single lump-sum principal repayment at the end of the loan period, each repayment installment of an amortizing loan consists of both principal and interest.
Appreciation An increase in value is referred to as “appreciation”.
Aquifers An underground layer of water-bearing permeable rock or unconsolidated materials (gravel, sand, silt or clay) from which groundwater can be usefully extracted.
Arbuscules These are formed by arbuscular mycorrhizal fungi, and look similar to minute sea anemones because they have many small projections that extend inside the plant cells. They are formed by repeated branching of a hypha when it enters a cell.
Artifact A historical object made by humans
Ave Class of animals that are referred to as “true birds”, including domesticated poultry.
Bacteria Microorganisms that live in the soil and convert nutrients into forms usable by plants.
Basis Point a basis point (bps) is a unit that is equal to 1/100th of 1%, in other words one basis point is equal to 0.01%, similarly a 1% change is equal to a 100 basis point change.
Breed to produce offspring by giving birth or by hatching
Bull a sexually mature male bovine
Bushel a measurement of capacity or size
Canal a waterway built to let boats navigate the waters
Capital Capital is any financial asset or the value of an asset.
Capitalization (Cap) Rate Cap Rates measure a property’s yield (return) in a one-year time frame.
Cash crop what a farmer raises, crop or livestock, to sell for money
Cellulose component of plant cell walls that is not digestible by most animals
Cob the large round mass of an ear of corn where kernels grow
Combine a machine used for harvesting grain
Commensalism the symbiotic relationship where one organism benefits and the other is unaffected. An example is found in spiders that benefit from plant leaves in spinning a web on them, while the plant remains unharmed by the presence of the spider.
Commodity an agricultural good
Common Equity Common Equity means that investors have one-to-one (or equal) participation in each dollar invested and any potential profits or losses.
Compaction the compression of air spaces in the soil by heavy machinery
Corn Ears the part of a corn plant containing the corn cob, husk, and kernels
Corn Husk the leaf like layer on the outside of corn ears, also known as a "shuck"
Cradle a tool used for gathering a crop once it is finished growing
Crowdfunding Funding a product, idea, or venture using small amounts of money raised from the “crowd."
Cultivate to improve the land by plowing and fertilizing
Debt An amount of money (obligation) owed by one party (the debtor) to another party (the creditor).
Development Development is the process of building or adding to existing structures to increase the value of a property.
Disk to prepare the soil for planting by cutting the soil with rotating metal disks
Distributions Payments made to investors periodically, typically over the course a calendar year, either from profits or interest payments.
Domesticate to tame and breed for human use
Ecology the study of the environment and how living things interact with it
Ecosystem a community of living and non-living things that interact by exchanging matter and energy
Environment physical surroundings; all that is around you
Enzymes proteins that start a chemical reaction
Equity As it relates to real estate, equity can be measured as the amount of capital a sponsor (property owner/developer) puts into a property.
Erosion to wear away topsoil by water or wind and can be caused by intensive farming and overgrazing
Ethanol a form of natural gas that can be produced from corn
Eutrophication of a water system is caused by a high concentration of nutrients (e.g. from high fertiliser or manure runoff) entering into it and creating an ecological imbalance. This can lead to abnormally high levels of growth of algae and aquatic plants such as water hyacinths in rivers and lakes. This growth decreases oxygen levels in the water which has serious implications for the survival of other organisms in the system and, consequently, on food supply and biodiversity.
Excrete to get rid of waste, such as manure
Expense cost or charge of money
Extension Agency an outreach arm of an agricultural university which provides educational programs on farming and does research
Fallow left wihtout tilling or sowing after plowing
Farm Bureau a non-governmental political agency that works for farmers' rights
Farmshares™ Farmshares™ allow investors to invest directly into the agriculture supply chain. Whether investors want to invest in farming, processing, movement of goods, Farmshares™ gives them access to the profits of large scale agriculture projects, which are often only reserved for large institutional investors.
Feed a mixture or preparation used for feeding livestock
Feed Lots a small area where cattle are confined and fed carefully mixed, high-concentrate feed to fatten them
Feeder cattle cattle, ready to be finished for market, weighing 550-650 pounds or heavier
Fertilizer organic or inorganic nutrients that are added to the soil to help the growth of crops
Finances management of money affairs
Fixing in the nitrogen cycle, it is the process of nitrogen changing into a less mobile and more usable form by combining with hydrogen to make amonia
Flail a wooden bar with a wooden handle used for removing grain or seeds from stalks
Free Cash Flow (FCF) Free cash flow is a measure of a property’s ability to generate cash after setting aside reserves for capital expenditures such as future development, tenant improvements, and leasing commissions.
Gene the DNA code in the cells of all living things; they determine physical characteristics such as fur color
Grade classification system of food quality
Grange an organization of farmers that provides support and plans social functions
Grass a type of plant with jointed stems, slender flat leaves and spike like flowers such as corn and wheat
Green manure a type of cover crop that is selected to increase soil fertility, most often for its contribution of nitrogen, because this is often the most limiting nutrient. Green manure crops are therefore often legumes.
Green Revolution Beginning in the 1960s, the "Green Revolution" became an important technological approach to farming, introduced as a way of increasing production of wheat, rice and maize to meet the needs of growing populations. The technological approach is based on input packages designed by agricultural scientific research centres. The package included new high-yielding seed varieties (to replace indigenous varieties) together with chemical inputs (pesticides, herbicides and fertilisers) and better irrigation, and allowed for the development of more intensive, monoculture-based agriculture.
Greenhouse gases These are carbon dioxide, nitrous oxide and methane. Scientists have concluded that human activities (including agriculture) that increase greenhouse gas concentrations have contributed to the current increase in the planet's temperature - known as "Global warming" or Climate change
Grit the inside of a corn kernel exposed after the outer covering, or hull, is removed
Groundwater water held underground that has seeped through soil layers and bedrock
Hard Asset A tangible object of worth that is owned by a business or individual.
Harvest to gather a crop when it is finished growing
Herbicide a type of pesticide that kills weeds
Hock back leg of cattle
Homestead the place where a family makes its home
Humus sticky, brown part of the soil that comes from dead plants and animals and contains many nutrients
Hybrid an offspring of two animals or plants that are of different breeds, varieties or species
Hydroponic grown in water without the use of soil
Income a gain in money usually as a result of business or labor
Inputs the amount of energy and money put into a farm in order to make a product
Insecticide a type of pesticide that kills insects
Intensive grazing the practice of rotating livestock between pastures to reduce overgrazing
Internal Rate of Return (IRR) Internal Rate of Return is used to measure the profitability of an investment.
Intrastate Crowdfunding While the Securities and Exchange Commission regulates public securities on a national level, each state also has its own regulatory entity serving a similar function. Since the passage of the JOBS Act, advocates of equity crowdfunding have moved to legalize intrastate – or in state – crowdfunding.
Inventory a list of current goods that you have or own
Jumpstart Our Business Startups (JOBS) Act The JOBS Act was a law passed in 2012 in the United States that eased regulations related to funding small businesses. Intended to increase American job creation and foster economic growth, the JOBS Act aims to provide easier access to public capital markets and small, growing companies.
Kernel the seed of a grain plant
Legume any plant that grows seeds in a pod such as peas and beans
Livestock any animals raised on the farm
Manure animal waste from stables or barnyards
Market where products are sold and exchanged
Matter the material which makes up something
Microorganisms tiny living things that can only be seen with a microscope
Mill a machine used to grind grain for food
Monoculture the practice of continuously producing or growing one single crop over a wide area. It is important to distinguish monoculture from agriculture in which different "sole" crops are rotated from season to season.
Monogastrics this term refers to animals with only one stomach. Examples include poultry (chickens, turkeys, ducks, geese and pigeons) and pigs.
Natural farming Based on the teachings of Masanobu Fukuoka, the essence of this method is to reproduce natural conditions as closely as possible. It calls for a farming system that does not require weeding, pesticides, chemical fertilizers or tillage. Biodiversity and always keeping the ground covered are important tenets.
Net forest loss takes into account both how much forest is removed as well as how much new forest is planted. The ten countries with the largest net forest loss per year between 2000 and 2005 (at 8.2 million hectares per year) are found in the tropics (Brazil, Indonesia, Sudan, Myanmar, Zambia, United Republic of Tanzania, Nigeria, Democratic Republic of the Congo, Zimbabwe, and Venezuela). While the ten countries with the largest net forest gain per year between 2000 and 2005 (at 5.1 million ha per year) are found in all regions: China, Spain, Vietnam, USA, Italy, Chile, Cuba, Bulgaria, France and Portugal (UNEP (United Nations Environment Programme). 2007. GEO4 Global Environment Outlook: Environment for Development, Progress Press, Ltd, Malta)
No till a method of growing grain when the farmer does not plow the field before planting
Nodule a swelling on the root of a legume that contains bacteria that fix nitrogen from the air
Nutrients nitrogen, phosphorous, potassium, and minerals that plants need to grow
Offal the inedible parts of a butchered animal removed in dressing it
Option finance term referring to a financial instrument that conveys the right, but not the obligation, to buy or sell another financial instrument or asset at a specific price within a specific period of time. Options are traded either in the over-the-counter market or in the exchange-traded market.
Organic agriculture The term is often used to indicate any farming system that does not use chemical inputs. However, under its official global organisation, "International Federation of Organic Agriculture Movements" (IFOAM), it is a specific certified commercial way of farming with ecological, social and economic objectives. Originating in the 1940s, this movement has grown such that 2 percent of total world farmland being certified organic in 2005.
Organic farming producing foods without the use of laboratory made fertilizers, growth subtances, or pesticides
Organic matter the dead plants, animals and manure converted by earthworms and bacteria into humus
Outgrower scheme a contractual partnership between growers or landholders and a company for the production of commercial agricultural products. Farmers are linked with a large farm or processing plant which supports production planning, input supply, extension advice and transport, usually but not always through contractual agreement. Out-grower partnerships vary considerably in the extent to which inputs, costs, risks and benefits are shared between growers/landholders and companies. Partnerships may be short or long-term (eg. 40 years), and may offer growers only financial benefits or a wider range of benefits. Also, growers may act individually or as a group in partnership with a company, and use private or communal land.
Outputs in agriculture whatever is coming out of a farming system, such as physical outputs like production of crops or animals, or water flows or losses, or more abstract elements such as improved knowledge and skills.
Pastures land or a plot of land used for the grazing of animals
Percolation the movement and filtering of fluids through porous materials, such as the movement of water through the soil.
Perishable food food that can decay or rot quickly if not refrigerated or taken care of in another way (e.g. through drying, salting, canning, etc.).
Permaculture the term "permaculture", coined by Bill Mollison and David Holmgren, is a blend of "permanent agriculture" and “permanent culture”. The goal is perennial agricultural systems that mimic the structure and interrelationships found in natural ecologies. Originating as an agroecological design theory, it freely borrows techniques and cultural systems from organic agriculture, sustainable forestry, horticulture, agroforestry and the land management systems of indigenous peoples, developing organising principles that are transferred through two-week intensive permaculture design courses around the world. (For more information and links to resources, see the Permaculture Research Institute of Australia’s website at: www.permaculture.org.au)
Pesticide a substance that kills any pest, including insects, fungi, and weeds
pH a value that indicates the acidity of the soil
Photosynthesis the process by which green plants use light energy from the sun to produce sugar from water and the air
Plow to work the soil by turning over the top layer; the machine used to turn the top layer of soil
Pollinate to fertilize by transferring pollen from the anther to the stigma of a flower
Polyculture agriculture using multiple crops in the same space in imitation of the diversity of natural ecosystems, and avoiding large stands of single crops, or monocultures. It includes crop rotation, multi-cropping, intercropping, companion planting, beneficial weeds, and alley cropping.)
Pork bellies meat from the belly area of a pig; used for bacon
Port a town or city where ships are loaded with products to be shipped overseas
Position limits Position limits are the predetermined position level (number of contracts allowable for holding) set by regulatory bodies for a specific futures or options contract. Position limits are created for the purpose of maintaining stable and fair markets.
Preferred Equity Typically in a Preferred Equity investment, all cash flow or profits are paid back to the preferred investors (after all debt has been repaid) until they receive the agreed upon “preferred return.”
Preferred Return A Preferred Return is paid to investors before a sponsor receives any share of the cash flow.
Pro-Forma A financial model often used in real estate to predict future cash flows and total investment returns.
Project Payment Dependent Notes A Project Payment Dependent Note is a special, limited obligation of Fundrise Investments, LLC sold to investors, the proceeds of which are used to fund corresponding project investments.
Reciprocity the mutual equivalent exchange of goods and services over time.
Recycling when the end product of one system becomes an input and resource for another (e.g. manure from livestock becomes nutrient source for crops; crop residues become nutrient source for soil, or fodder for livestock).
Redemption In the event of back taxes or unpaid liens, a borrower who pays off those debts may reclaim their property, preventing foreclosure or the auctioning of their property.
Regulation A Regulation A allows unaccredited investors to purchase small offerings of securities that do not exceed $5 million in a 12-month period.
Regulation A+ Regulation A+ is the SEC’s proposed revision of the current Regulation A, which was mandated by the JOBS Act in 2012.
Regulation Crowdfunding Outlined in the 2012 JOBS Act, Title III instructed the SEC to create an exemption from registration that, when implemented, will enable issuers to engage in crowdfunding equity offerings to the general investing public.
Regulation D Regulation D permits raises of unlimited amounts from accredited investors without registering a public sale through the SEC, as it’s assumed that accredited investors are financially able to bear the burden of investment decisions without a review by the SEC.
Relay cropping a second crop is started amidst the first crop before it has been harvested, an important example of building the agrobiodiversity buffer in the farm.
Remittance a transfer of money by a foreign worker to his or her family in his or her home country.
Rendering plant a place where lard, tallow, and oil are extracted from animal parts
Resilience being able to buffer shocks and stresses
Retailer a trader that sells directly to individual customers, as in a shop.
Rhizobia soil bacteria that fix Nitrogen after becoming established inside root nodules of legumes. Rhizobia require a plant host as they cannot independently fix nitrogen.
Rhizosphere soil located in the immediate vicinity of plants' roots.
Rotation the changing of the specific fields used for one crop year to year
Row Dividers the large points on the end of a combine used to pick-up corn
Rumen the first large compartment of the stomach of a bovine; its bacteria and protazoa break down cellulose
Ruminant this term comes from the Latin ruminare, which means "to chew over again" as these animals have several stomachs and regurgitate their food from their first stomach, chewing it once again to be able to digest it. Ruminants include cows, buffaloes, goats and sheep, among others.
Scythe a blade with a long handle used to cut grass, grain, and other crops
Secured vs Unsecured Position A secured position in the Capital Stack retains the right to foreclose on a property in the event of a default, or non-performance. Unsecured creditors do not have the right to foreclose on the property, and therefore have less collateral backing their investment claim.
Senior Debt The "base" of the Capital Stack -- Senior Debt is generally secured debt that must be repaid first.
Shear the act of cutting hair or wool
Shock a pile of grain that is set up like a cone
Silage a mixture of raw materials such as field corn, sorghum, grass, or clover that is converted into winter feed for livestock
Sine qua non indispensable
Slaughterhouse a place where animals marketed for meat are killed humanely
Soil Conservation careful preservation or protection of soil
Species a group of living things that share common biological characteristics
Sponsor An individual or firm in charge of finding, acquiring, and managing a piece of real estate.
Steer a bull that has been castrated for better meat production
Stewardship an individual's responsibility to exercise care over possessions entrusted to him or her
Sub-division a piece of land to be divided into smaller lots, typically for housing
Technology instruments, tools or inventions developed through research to increase efficiency
Tenancy / Occupancy Occupancy is generally referred to as a percentage of the total square feet or units leased – it is a building’s revenue source.
Tenant a person who pays rent to live on someone else's land
Term The lifespan of a given asset or liability.
The Capital Stack The Capital Stack orders the seniority of claims to the collateral and cash waterfall of an entity.
The Jumpstart Our Business Startups (JOBS) Act The Jumpstart Our Business Startups (JOBS) Act is a law intended to facilitate funding of small businesses by easing regulations.
Thresh to beat out a grain or seed from a stalk by treading, rubbing or striking with a flail, or with a machine
Total Mixed Ration a feed combination of hay, corn, barley, field grasses, cotton seed, and bakery or grocery by-products
Unaccredited Investor An investor who does not meet the wealth requirements of an accredited investor set forth by the SEC.
Urbanization the growth of the city into rural areas
USDA United States Department of Agriculture, a Federal agency involved in all phases of agriculture
Weed any unwanted plant, especially those that crowd out more desirable plants
Wilting point the minimal point of soil moisture that a plant requires not to wilt. If moisture decreases below this point, a plant wilts and can no longer recover its turgidity (the pressure inside the plant cells) even when soil moisture is replenished. The wilting point is a constant (characteristic) of a particular soil.
Work ethic qualities of character believed to be promoted by work
Yield the amount of a crop produced in a given time or from a given place