Roughly 5,000 data centers built or under construction nationwide
About 30 miles from Clint McRae’s southeastern Montana ranch, a utility company purchased roughly 6,000 acres of cattle grazing land. McRae, a fourth-generation rancher, said he has deduced through job postings and conversations with neighbors that the site may become a large-scale data center.
McRae’s primary concern is water, which is already scarce in the region. “If we have a dry year like we’re having now, who’s going to cut back?” McRae said. “It’s going to be agriculture.” He has begun rallying local ranchers to speak out at town hall meetings against new data center projects.
A spokeswoman for NorthWestern Energy, the utility that bought the land, said no decisions have been made and no timeline set. “Securing land now helps ensure we have options later, without rushing decisions that could impact reliability or costs,” she said.
The broader agriculture industry is raising similar alarms. Philip Nelson, president of the Illinois Farm Bureau and a fourth-generation corn and soybean farmer, said tech companies are racing to secure rural land. “It’s almost like the wild west to see who gets there first,” Nelson said. He has organized meetings with farmers and brought growers to the state capitol to discuss concerns with lawmakers but said it has been difficult to gain traction.
Nelson said he worries that if the AI market crashes, some of the best farmland in America could be left housing idled data centers. “When you take a thousand acres out of production just to build one of these, that’s a big footprint,” he said.
Technology companies have faced backlash from locals concerned about power usage and strain on local grids. Lawmakers in roughly two dozen states are considering banning or restricting data center development, according to the report.
Dan Diorio, vice president of state policy for the Data Center Coalition, a trade group, said data centers are efficient water users and require far less than agricultural production. He said facilities often use hybrid cooling systems, running air-based cooling 90% of the year and switching to water-based cooling during the hottest days. Diorio also said utility companies in some states, including Indiana and Georgia, are lowering or freezing power rates because of data center revenue.
On the issue of farmland loss, Diorio said no one is forcing farmers to sell. “I find that argument a bit perplexing,” he said. “These are ultimately private transactions between a property owner and someone that wants to purchase the property.”
Some farmers have turned down offers of tens of millions of dollars, Nelson said, but for many aging farmers, that money offers a convenient retirement plan in a tough farm economy.
Data centers are not the only driver of farmland decline. USDA’s latest Census of Agriculture showed farming acreage declined by an area about the size of Maine between 2017 and 2022. Residential development, farmer consolidation and ranch-land conversion to hunting grounds have also contributed.
“The amount of ground that we’re seeing move out of production agriculture is something that we really do need to keep an eye on,” said Jarrod Gillig, who leads the North America beef business at Cargill, speaking at The Wall Street Journal Global Food Forum.
Despite the criticism, the agriculture industry is increasingly dependent on the digital infrastructure data centers provide. Cargill has begun rolling out an AI-powered computer vision system called CarVe in its beef plants. Debbie Lyons-Blythe, a cattle rancher from Kansas, said losing prairie grasses is a problem but that she also increasingly uses AI to manage her operations. “They are vitally important to me as well,” she said about data centers.