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The latest on the farmland market

Jeff Caldwell 03/28/2013 @ 8:21am Multimedia Editor for Agriculture.com and Successful Farming magazine.

Farmland values -- and the general topic's many subplots, like leasing rates, the consequences of skyrocketing prices and how values will respond to a potential continued drought -- continues to resonate around farm country as a major topic with major implications to bottom lines from the western Plains to the eastern Corn Belt.

Here are a few of the latest farmland features, from signs the trend of rocketing values is reversing, to the performance of land in the greater investment sector context.

   


3 signs farmland may be topping

Not even an historic drought could trip up farmland values in the Corn Belt in the last year. Double-digit gains continue even outside of what's typically thought the hotbed of skyrocketing farmland values. But, some new information shows proof that the apex may be near.

 

Verbal vs. written lease deals

A hearty handshake has long been thought a binding agreement when it comes to some business deals on the farm. Now, partly because land values have exploded, the move toward contractual leases signed by all involved parties has gained momentum.

 

Farmland or stock market?

A 10% to 15% increase in value every year has made farmland an enticing investment opportunity, especially compared to a stock market short of such gains. This dynamic has caused many investors to question which market's the safest place for their money: Land or stock.


Farmland poised for big gains?

Many U.S. farmers have already become active this year in purchasing land or paying higher cash rents. Because of the intense buying interests from farmers and institutional investors, farmland could see another 15%-20% jump in value in 2013.

 

Rocketing land warrants caution

New information shows the skyward trend of farmland values in the eastern Corn Belt is showing little to no signs that it's abating. Ordinarily, that would be cause to be bullish on land in the near future, right? Wrong, says one economist.

 

Land ‘supercycle’ or bubble?

Farmland bubble. Those 2 words have been the topic of reams of speculation in the last few months, and that speculation should zero in on a few key factors through 2013, experts say. First, don’t overlook the cyclical nature of the marketplace.


Land a 'best-in-class asset?'

Farmland has a large income return and is an undiscovered asset class, an industry expert told a group of investors recently. When trying to diversify your investment portfolio, farmland is being proven as a positive asset class.

 

Post-drought pasture leasing

Farmland leasing and negotiating land rental rates can sometimes rival walking a tightrope. Get too far out of balance one way or another, and sometimes a deal can completely fall apart. And, that's true with pasture and grazing land, too.

 

Irrigated land a hot commodity

When a drought's on, you need water. And, recent data shows that's exactly what's happened in the farmland market over the last few months in the nation's center where some of the worst effects of the drought effects unfolded in the latter half of 2012.

 

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