Results of cropland survey are in

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Landowners, prospective buyers, lenders and others involved in agriculture often seek baseline data and trend data with which to base their buy/sell decisions upon.
Survey data can have it’s limitations based on bias from those surveyed. Landowners have an interest in seeing this range of data at the high end of the range, whereas prospective buyers or renters would like to see lower baseline numbers.
Survey. This survey draws on the expertise of numerous professional groups that are knowledgeable of Ohio’s cropland markets. Surveyed groups include farm managers, rural appraisers, agricultural lenders, Ohio State University Extension Educators, farmers and Farm Service Agency personnel.
Surveying these agricultural professionals is an attempt to capture unbiased data for evaluating cropland value and cash rents. One hundred twenty-four surveys were completed, analyzed and summarized.
Thirty-five percent of the surveys (44 total) were collected from professionals in northwestern Ohio, while 47 percent of the respondents (58 total) were from southwest Ohio.
Fourteen percent of the surveys (17 total) were returned from professionals in northeast Ohio and the remainder were from southeastern Ohio.
Respondents were asked to give responses based on three classes of land in their area; “top” producing land, “average” producing land and “poor” producing land.
Top cropland. Survey results indicate that “top” performing cropland in Ohio averages 177.75 bushels of corn per acre. Results also show that average value of top cropland is $4,001.79 per acre.
According to this survey, top producing cropland in Ohio is expected to be valued at $4,167.71 in 2007. This is a projected increase of 4.15 percent.
Top cropland in Ohio rents for an average of $131.88 per acre according to survey results. This equates to a cash rent of $0.74 per bushel of corn produced or $2.24 per bushel of soybean production.
Rents in the top cropland category equal 3.3 percent of land value.
Average cropland. Average cropland yields for “average” production cropland equal 145.7 bushels of corn per acre. Results show that the value of average cropland in Ohio is $3,371.17 per acre.
According to survey data, this average-producing cropland is expected to be valued at $3,532.22 per acre in 2007. This is a projected increase of 4.78 percent.
Average cropland rents for an average of $104.19 per acre according to survey results. This equates to a cash rent of $0.72 per bushel of corn produced or $2.24 per bushel of soybean production.
Rents in the average cropland category equal 3.09 percent of land value.
Poor cropland. The survey summary shows the average yield for “poor” performing cropland equals 116.96 bushels of corn per acre. Results also show that the average value of poor cropland is $2759.81 per acre.
According to survey data, this poor-producing cropland is expected to be valued at $2,891.46 by July of 2007. This is an increase of 4.77 percent.
Poor cropland rents for an average of $80.98 per acre according to survey results. This equates to a cash rent of $0.69 per bushel of corn produced or $2.27 per bushel of soybean production.
Rents in the poor cropland category equal 2.93 percent of land value.
Cash rent. Cash rent measures such as “rent as a percent of land value” and “cash rent per bushel of corn production” are valuable in many rental negotiations, as many use these measures as “rules of thumb” when negotiating cash rental rates.
In this study, rent as a percent of land value ranges from 3.3 percent for top cropland to 2.93 percent for poor cropland. Rent per bushel of corn production is $0.74 for top cropland, $0.72 for average cropland and $0.69 for poor cropland.
Comparing rent per bushel to other north central states, such as Indiana and Iowa, show Ohio values to be lower per bushel than these comparable states.
For example, the Purdue Land Value Survey, June 2006 finds rent per bushel on “average” land to be $0.91 per bushel of corn production. Rent per bushel of soybean production is $2.24 for “top” cropland; $2.24 for “average” cropland; and $2.27 for “poor” cropland.
According to survey results, cash rents are expected to increase 6.27 percent from 2006 to 2007.
Values. Surveyed professionals see cropland values increasing 11.18 percent the next five years.
Survey responses varied greatly for cropland value change over a five-year time horizon ranging from up 50 percent to minus 35 percent.
Pasture rents average $42.13 per acre according to the survey results. Pasture quality farmland has an average value of $2430.19 per acre.
Northeast Ohio. Survey results indicate that “top” performing cropland in northeast Ohio averages 170 bushels of corn per acre. Results also show that average value of top cropland is $4,630.77 per acre.
According to this survey top producing cropland in northeast Ohio is expected to be valued at $4,761.54 in 2007. This is a projected increase of 2.82 percent.
Top cropland in northeast Ohio rents for an average of $95.33 per acre according to survey results, which equals $0.56 per bushel of corn produced or $1.56 per bushel of soybean production.
Rents in the top cropland category equal 2.06 percent of land value.
Average yields. Average cropland yields for average production cropland equal 134.33 bushels of corn per acre. Results show that the value of average cropland in northeast Ohio is $3,753.85 per acre.
According to survey data this average-producing cropland is expected to be valued at $3,961.54 per acre in 2007. This is a projected increase of 5.53 percent.
Average cropland rents for an average of $68 per acre according to survey results, which equals $0.51 per bushel of corn produced.
Rents in the average cropland category equal 1.81 percent of land value.
Poor cropland. The survey summary shows the average yield for “poor” performing cropland in northeast Ohio equals 103 bushels of corn per acre. Results also show that the average value of poor cropland is $3,100 per acre.
According to survey data, this poor-producing cropland is expected to be valued at $3,250 by 2007. This is an increase of 4.84 percent.
Poor cropland rents for an average of $48.71 per acre according to survey results, which equals $0.47 per bushel of corn produced. Rents in the poor cropland category equal 1.57 percent of land value.
Cash rent. In northeast Ohio, rent as a percent of land value is 2.06 percent for top cropland; 1.81 percent for average cropland; and 1.57 percent for poor cropland.
Rent per bushel of corn is $0.56 for top cropland; $0.51 for average cropland; and $0.47 for poor cropland. Rent per bushel of soybean production is $1.56 for top cropland; $1.54 for average cropland; $1.56 for poor cropland.
The northeast region for the purposes of this survey includes: Erie, Lorain, Cuyahoga, Lake, Ashtabula, Huron, Richland, Ashland, Medina, Summit, Portage, Geauga, Trumbull, Wayne, Stark, Mahoning and Columbiana counties.

About the Author

(Barry Ward is the leader of production business management in the Ohio State University Extension’s department of agricultural, environmental and development economics.) More Stories by Barry Ward

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