Farmland Values for Best Land Sink to Lowest Level in Seven Years
(WEST LAFAYETTE, Ind.) - More trouble for Indiana farmers: their land isn't worth as much.
The annual Purdue Land Value Survey finds the best farmland selling for $456 an acre less than it did last year. That's a 5% decline, and a 16% drop since values peaked five years ago. The current average is the lowest since 2012.
Average-quality farmland values dropped by 3%. Poor-quality farmland recorded a tiny increase in value for a second straight year, though prices remain well below the 2014 peak.
Purdue agricultural economist Craig Dobbins says farmland values have slid in tandem with corn and soybean prices. Strong yields the last two years cushioned the effect, but farmers were hammered this year by a rainy spring that delayed planting by months.
Dobbins cautions that because Purdue takes its survey in June, the figures may reflect a spike in nervousness as farmers made final stabs at getting this year's crop in. But he says the escalating trade war with China has made the outlook worse. He says potential buyers considering a mortgage loan have to consider their ability to pay it off, and the combination of Chinese tariffs and import limits, the planting delays, and sliding prices have all contributed to greater uncertainty.