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Sunday, June 12, 2011

Ind. Gov't. - "Farmland values up, set to go higher, experts say"

Eric Weddle reported June 10, 2011 in the Indianapolis Star:

A Purdue University agricultural economist expects that a report due later this summer will find farmland values eclipsing the all-time high set last year.

"This is being driven by the high commodity prices and the returns that grain farmers expect to receive from this year's crop," professor Craig Dobbins said Friday.

An annual survey, "Farmland Values and Cash Rent Survey," being conducted by Purdue researchers is based on information from managers, appraisers, land brokers, agricultural loan officers and others across the state.

Between 2000 and 2010, the average price per acre of average quality farmland in Indiana -- land capable of producing an average corn yield of 155 bushels -- rose from $2,173 to just more than $4,419 last June.

So far, Dobbins is seeing surveys for the 2011 report that value land significantly higher.

Low interest rates also are pushing the farm values up, he said, because it allows farmers to purchase more land instead of other investments. * * *

Ethanol production also remains a factor in grain demand.

Recent sales of farmland during the past year in Greater Lafayette and surrounding areas show signs of prices rapidly increasing.

In February about 82 acres on seven tracts near Dayton sold for $558,000. That includes one tract going for $7,995 per acre and some acres of four tracts sold at $6,832 per acre.

Shortly before that a 159-acre farm in Benton County, which included two wind turbines, was sold at auction for $8,237 an acre.

Dobbins said an acre being sold in Tippecanoe County for $8,000 is reasonable.

See also this ILB entry from May 25, 2007.

Here is the 2010 Purdue report.

Posted by Marcia Oddi on June 12, 2011 09:34 AM
Posted to Indiana Government