News

Survey shows land prices on the decline

Results of a Purdue University survey show farmland values across the state are on the decline.   Purdue ag economist Michael Langemeier says he wasn’t surprised by the results.  “The declines ranged anywhere from 4 percent for average ground to 5 percent for top ground or top productivity ground,” he says.

He says the survey did show a slight increase in land values in the southwest part of the state.  “And I think the reason is two-fold,” he says.  “One – I think land values didn’t increase quite as fast in that region, particularly compared to the northern half of the state.  The second and more important reason is that corn and soybean yields were very strong in 2014.  And I think that helped contribute to the increase.”

He says cash rents also declined.  “Below average, average, and above average declined and the cash rents were negative 1 to 2.5 percent,” he says.

With current commodity prices, Langemeier tells Brownfield the downward trend could continue.  “Looking at budget projections and net returns for both corn and soybeans in Indiana – it seems to me we could have some softening over the next 3 to 5 years,” he says.