Farmland values pushing higher

WASHINGTON – Farm real estate values, a measurement of the value of all land and buildings on farms, averaged $1,360 per acre on Jan. 1, 2004, up 7 percent from 2003.
This is the largest percentage increase since 1994, when farm real estate values rose 8 percent from the previous year.
The USDA’s National Agricultural Statistics Service released its latest farmland real estate report last month.
Farmland average. Cropland and pasture values rose by 7 and 6 percent, respectively, from Jan. 1, 2003.
Cropland values averaged $1,780 per acre and pasture values averaged $644 per acre on Jan. 1, 2004, compared with $1,660 and $605 per acre, respectively, a year earlier.
The increase in farm real estate values was driven by a combination of factors, including low interest rates, high commodity production and prices, and strong demand for nonagricultural land uses.
Cash rents advance. Cash rents paid to landlords for cropland and pasture during the 2004 crop year also rose from 2003.
Cropland cash rents paid in 2004 averaged 5 percent above a year earlier, advancing to $76.50 per acre, compared with $73 per acre for 2003.
Cropland cash rents increased in all regions except the Pacific region, where rental rates were unchanged.
Pasture cash rents rose 7 percent, from $9 per acre in 2003 to $9.60 per acre in 2004.
Pasture cash rents rose in all regions, led by an 8 percent increase in the Pacific region and a 7 percent increase in the Corn Belt.
In the Northern Plains and Southern Plains regions, which combine for about two-thirds of the cash-rented pasture acreage, rental rates were up 5 percent and 1 percent, respectively.