Expectations for farmland values are steady as concerns about interest rates continue
Farmland values have held steady in recent months despite rising interest rates.
Ag economist Jim Mintert with Purdue University’s Center for Commercial Agriculture says the latest Purdue/CME Group Ag Economy Barometer looked at both short and long-term expectations for land values. He says near-term expectations have been steady in recent months. “But, if you look at that index over time, you can tell the people are less optimistic than they were,” he says. “For example, two years ago that short-term index was an index value of 146, now we’re 20 points below that.”
He tells Brownfield there has been less variability in farmers’ longer-term expectations. “That reading is 151 which is really unchanged for the last couple of months,” he says. “That’s slightly stronger than a year ago, a year ago that was at 146 and I think the all-time peak on that index over the time frame we’ve been asking the question, which is the beginning of 2019, our highest reading is about 161.” Mintert says 12% of respondents expect farmland values to decline over the next 5 years.
The Ag Economy Barometer is a monthly national survey of 400 U.S. agricultural producers.
AUDIO: Jim Mintert, Ag Economy Barometer