Agricultural land values and cash rentals have remained stable despite sustained pressure on farm revenue and commodity prices. Low-interest rates (the 10-year Treasury is less than 1%), a low turnover ratio for agricultural acreage, and a competitive cash rent market for farmers looking to realize economies of scale are thought to be the reasons for this stability. Notably, the cash rental rates were set before COVID-19 impacted crop prices. It is essential to know about Louisiana Landsource.
According to USDA’s newly issued 2020 Land Values report, the average value of agricultural cropland in 2020 is $4,100 per acre, unchanged from 2019 but in line with record highs witnessed in 2019 and 2015. Similarly, the average value of farmland in 2020, which includes all land and buildings on farms, remained constant from the previous year’s record high of $3,160 per acre. In 2020, the average price of pastureland was $1,400 per acre, unchanged from 2019. In 2020, cash farmland rental rates were $139 per acre, down $1 per acre from 2019.
Get to know about Agricultural Land Values at the State Level.
The Northeastern states had the most significant agricultural land values, with densely populated urban areas like Rhode Island, New Jersey, Connecticut, and Massachusetts making up four of the top five states in terms of average agricultural land values. California rounds off the top five. The Corn Belt, the Great Lakes region, the Southeast, and the Pacific Northwest have the highest agricultural land values outside of urban areas. Agricultural land values in the Corn Belt were most elevated in Illinois, at $7,400 per acre, and Iowa, at approximately $7,100 per acre. The most significant drops in agricultural land prices were in Kansas and New York, down 3.1 percent from the previous year.
In the Corn Belt, agricultural land prices in Iowa fell 1.7 percent, or $120 per acre, while they fell 2.9 percent in South Dakota. The agricultural land values in other Corn Belt states, such as Illinois, Ohio, and Indiana, were more significant due to the larger metropolitan centers. The most important aspects of any business are on-time delivery and the safety of the items. Transport companies with years of experience can fulfill this. However, make sure that the transportation firms or online truck booking companies you’re considering have a lot of experience in the locations you’re interested in. The transportation business should be well-versed in dealing with any technical, legal, or other relevant concerns that arise during the transit process.
Are you aware of Rental Rates in Cash?
Many farm operators rent cropland in addition to owning agricultural land. Rental agreements are typically formed in the fall of the preceding year; for example, the rental prices for 2020 were agreed upon in the fall of 2019. They’d be made at the very least before planting. USDA’s state-level projections of farmland cash rents for 2020 show an average rental rate of $139 per acre in the United States, down $1 per acre, or 0.7 percent, from 2019. Since 2015, when the national average cash rental rate dropped $8 per acre, this is the first time the national average has fallen.