Nebraska land values soar
As the grain markets continue to surge upward, they continue to send up farm land values in the nation's midsection. The latest proof: Reported double-digit value gains in yet another state, Nebraska.
Ag economists at the University of Nebraska (UNL) this week released the results of their annual survey of land values, one that shows the average price of land in that state rose by 22% statewide over the last year. That means the average price paid for land in that state has doubled in the last 6 years. All categories of land saw big gains, but crop ground led the charge.
"That's a clear reflection of high income conditions for the state's crop sector over the past few years," says UNL ag economist Bruce Johnson, who leads the survey.
Overall, a university report indicates the northeast, central and southern regions of the state saw 25% gains over the last year, with more modest gains of 12.3% and 13.9% coming in the northwest and southwest districts, respectively. Johnson says that's indicative of the larger percentage of forage and rangeland in those parts of the state versus cropping acres.
- See more from the UNL land values survey
- More on the land market: Big rents & high land
- Also: 'The price of farmland'
It's a year of firsts for land values in Nebraska, too. This year's survey shows a price tag over $6,000 per acre, with land in the eastern district showing a value of $6,175 per acre, up 27% over a year ago. "2011 is a very unique time in the agricultural land markets," Johnson says.
From here on, the economist says though crop incomes are at healthier levels than they have been in a while, it's also a time to be cautious about the land market's future.
"[Farmers] see higher income flows contributing greatly in the short run to dramatic upward advances. They also note that while buyer demand is high, the availability for sale is very limited," Johnson says. "Market participants, both current buyers and existing owners, are financially strong and not vulnerable at this point. Still, a general tone set by our reporters is that risk levels are moving upward, and it is a time to be very cautious."