Farmland Prices Weaker This Year

A third straight year of weaker farm sector profitability keeps the pressure on farmland values, according to a recent survey.

But it appears the threat of a 1980s-style crash remains low as many land sales still fetch quality prices.

A midyear survey of the market conducted by the Illinois Society of Professional Farm Managers and Rural Appraisers (ISPFMRA) found land prices so far this year in the state slipped by a range of 3.3 to 7 percent.

ISPFMRA released the report Wednesday at at the Farm Progress Show.

“We continue to see a little pullback in farmland prices,” said Dave Klein, chairman of ISPFMRA’s Illinois Farmland Values Survey. “We know we’re not where we were at in the 2012-to-2014 time period.”

The correction continues to occur as a direct result of lower commodity prices, high input costs and weaker farm sector profitability.

USDA projects net farm cash income will fall for a third straight year in 2016 by 13.3 percent from 2015. If realized, net farm income this year will be the lowest since 2009.