View from the Cab: Have farmland prices in Illinois peaked?
Statewide farmland values are up 18 percent and may have plateaued, according to a survey from the Illinois Society of Professional Farm Managers and Rural Appraisers.
Information from the mid-year farmland values snapshot survey was released during last week’s Farm Progress Show at Boone, Iowa. Land prices across Illinois have maintained their strength from 2021, however the peak may have been reached as a flattening in prices paid for land in the state is anticipated for the second half of the year.
Cash rents in 2023 are expected to increase by $17 per acre on excellent productivity farmland and lower productivity land is expected to have lower increases with fair productivity ground having an $8 per acre projected increase. Survey participants expect 2023 crop prices to average $5.60 per bushel for corn and $13.20 for soybeans. These prices are a continuation of the strong commodity prices seen since the start of 2021.
The slow increase of variable cash rental agreements is expected to continue as society members say 31 percent of leases are now variable. The average price increase of 18 percent occurred across all of Illinois and land productivities. More than half of those responding to the survey feel prices have reached a plateau with 56 percent expecting prices to remain the same during the second half of 2022.
All of those surveyed expect interest rates to increase in the second half of the year. The group was equally divided in the amount of a rate increase being over or less than one percent.
Findings were reported by Gary Schnitkey, Ph.D., University of Illinois, and Luke Worrell, AFM, ALC, overall chair of the society’s annual Land Values and Lease Trends program. ISPFMRA documents farmland prices and Illinois cash rents at year end and conducts this survey halfway through the year to evaluate trends. Survey information was collected during the first two weeks of August with the results officially presented Aug. 31.
The farm meeting and meal season continues for our family. We had a great time the other night with a delicious meal, fellowship and information at the Atkins Seed Service plot night and Shorty Stork’s field day was held a couple of days later. It is always good to visit with fellow farmers ahead of the pending harvest season.
Harvest is still a couple of weeks away it sounds like. In fact, one agronomist tells me it could be the very end of September or early October before things really pick up in Central Illinois. Many fields were planted late in the spring, but some were lucky enough to get in during April to put corn and soybeans in the ground.
The latest ag news, podcasts, midday market updates and ag blogs can be found at www.centralillinoisfarmnetwork.com. Listen for Kent’s early morning ag show, “A Central Illinois Morning” weekdays at 5:06 on WGCY 106.3 or from the CIFN website.
This article originally appeared on Pontiac Daily Leader: View from the Cab Kent Casson have land prices peaked
