The March LANDTHINK Pulse revealed 41.82% of respondents think that farmland values in 2014 will remain flat, after a significant drop in commodity prices in 2013.
As reflected by the results of last month’s informal online survey, most think that in light of slumping commodity prices, farmland values will remain flat or only slightly decrease. For the last 5 years or so, farmland prices have soared across the Heartland, selling at record per-acre prices. Many people in the industry, however, are concerned about a downturn in farmland values, given the sharp decline in commodities, especially corn and grain.
Last month, the March Pulse asked: Given the significant drop in commodity prices in 2013, what effect will it have on farmland values in 2014?
The LANDTHINK audience seemed to be agreement. The general consensus (41.82%) thought farmland values would “remain flat”, followed closely by 33.64%, who thought there would be a small decrease in values.
The last couple of years, high commodity prices coupled with low interest rates, fueled the booming farmland market and attracted scores of investors. The continual decline in commodity prices means lower income for farmers, which consequently leads to lower land values, fewer farmland transactions and lower rental rates.
Here’s how the results panned out:
- 4.55% said there would be a Large Increase in values
- 15.00% said there would be a Small Increase in values
- 41.82% said values would Remain Flat
- 33.64% said there would be a Small Decrease in values
- 5.00% said there would be a Large Decrease in values
Congratulations to Joe Blackburn, winner of the $50 Amazon gift card after answering the March Pulse question! Joe is a Sales Associate at Tutt Land Company, with a focus on southeast Alabama.
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