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Organic Land Values
Anyone looking for certified organic row crop farmland is going to have a hard time comparing prices with comparable conventional farmland. Data service company Mercaris is partnering with People’s Company and Midwestern BioAg. They’ve launched an initiative called “Mercoterra” to track organic farmland values and create a tool kit for land buyers who are deciding if they want to go organic.
Jessie Bovay is the director of business development for Mercaris. She says to make comparisons, they are surveying farmers across the country for both conventional and organic land prices.
"Our plan is to test the theory that certified organic crop land will appraise at a different value that comparable conventional farmland. If you look at just purely the premium that organic crops have over conventional crops, you would think that organic farmland would appraise at a higher value, would rent at a higher value, would sell at a higher value, but sometimes that’s not true," says Bovay. "So, we’re just hoping to dig into it and finally come up with an answer."
There are many factors to consider. She says there is a lot of argument over organic operators who don’t do a good job of taking care of the weeds, or it doesn’t look as nice as the conventional property on the other side of the fence.
"We’re hoping that the effective soil quality will have some intrinsic value on organic farmland," she says. "The idea is that when you’re farming organically you take better care of the soil, you’re doing it in a more sustainable way, and we’re hoping maybe there’s some value behind that."