Producers remain optimistic about farmland values
Farmers remain bullish on farmland values, according to the latest Purdue University/CME Group Ag Economy Barometer.
Jim Mintert is the director of the Purdue Center for Commercial Agriculture.
“Farmers remain very optimistic about farmland values,” he says. “That Short-Run Farmland Value Expectation Index was one point lower than last month and is basically sitting at a record high. That Long-Run Farmland value Expectation Index, which is based on a question that asks people to look out five years, set a record high this month when it rose 10 points to a reading of 158.”
The survey also asked farmers about their expectations for cash rental rates in 2022.
“Two-thirds of the corn and soybean producers in the survey said they expect to see higher cash rental rates for the 2022 crop season,” he says. “That number was pretty equally split between people expecting to see a range of increases of 5 to 10 percent to people expecting to see an increase of 10 percent or more. A 10 percent or more move in cash rental rates is a pretty big move, and you don’t see that happen very often in cash rental rates.”
Forty-three percent of respondents expect cash rental rates to rise by 10 percent or more and 39 percent expect rates to rise from 5 to as much as 10 percent.
The ag economy barometer is a monthly national survey of 400 U.S. ag producers. Fifty-three percent of farmers surveyed grow corn or soybeans, 19 percent raise beef, 14 percent grow wheat, six percent raise hogs, five percent are dairy farmers, and three percent grow cotton.