COLUMBUS — Farmland values across the United States continue to increase according to farm management company, Farmers National Co.
“Farmers National Co. is a large nationwide farm real estate management company. They’re involved in a lot of different transactions in the farmland space, both buying and selling, but also managing for a number of different types of investors and landowners.,” Spectrum News 1 agriculture expert Andy Vance said. “And although, you know, farm profitability may have been down somewhat due to higher input costs in recent years, the findings are still because we’re not making any more of that farmland. Values continue to increase as much as 20 to 30 to even as high as 40% year over year across some of those Corn Belt states.”
Vance said an aging population may be one reason for record sales volume.
“If you think about the aging nature of our population in general, we’ve been talking in the business space for years about, you know, as the boomers retire, what does that mean for the world of work? It’s it same situation in farming as that generation retires, decides they’re ready to hang up their boots. Maybe they want to do some generational transfer. Maybe they’re looking around at values and saying, ‘You know what, I’m never going to have a better opportunity to cash out, so to speak, than this,'” Vance said.
Buyers of the land are a mixed bag.
“And what you’re looking at primarily from farm owners is existing farms getting larger. And when you think about why that is, the cost of living and the cost of raising a family of four, let’s say, is such now that you’ve got to have more acres of ground or more cows,” Vance said. “So when the neighbor sells, you buy that ground. That’s something that happens quite a lot. But the institutional investors, you think about large retirement funds, the various state pensions, they all are active investors, but you also have private investors who have been involved for years and are even more so because they continue to see that appreciation. And farmland throws off some income as well in the form of cash rents.”
