Farmland prices continued higher through the first half of 2022. Randy Dickhut, senior vice president of real estate options for Farmers National Company, says high grain prices were helping push land values even higher.
“They were going up because of the high grain prices and the outlook for continued higher than normal or average grain prices due to the Ukrainian conflict because everybody believed that, hopefully, that’s resolved, and peace returns sooner than later. But there’s still going to be longer-term ramifications about getting production back up, and exports back up, and the grain trade and the supply chain going for grain and food exports around the world. So, the outlook was good for a few more years, and what had been lower interest rates earlier on were propelling the land market.”
He says prices don’t seem to be rising quite as fast a little more than halfway through the year.
“Now, we’re seeing a little more variability. We’re seeing some new records that are just off the charts. And then, we’re also seeing a few places, maybe at an individual auction or something, where they’re just a little more hesitancy, so it didn’t set a new record. So, it’s a little off, maybe, what it would have sold for back in February or March after that war started.”
Prices for the highest-quality farmland continue to set new records.
“We sold some back in the winter, in Illinois, for 21,500 dollars per acre in Central Illinois. That was some of the best that we’ve seen or the strongest prices we’d seen. So, part of it is there’s just historically not a lot of farmland that gets sold into the open market in any given year. It’s usually less than one percent of the farmland across the country. A lot of times, it’s once every three-four generations before a farm in a neighborhood comes up for sale because it’s passed down through the farming family or to non-farming heirs that keep the land.”