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Your Precious Land

RSS By: Mike Walsten, Pro Farmer

Mike Walsten has covered major business trends in agriculture for more than 40 years.

18% Surge in North Dakota Cropland Values

Apr 05, 2012

Mike Walsten

The value of North Dakota cropland jumped 18% on an annual basis, according to a survey conducted by the North Dakota office of the National Agricultural Statistics Service in January, 2012. “By any measure, it has been a historical run for farmland values,” says Andy Swenson, North Dakota State University Extension Service farm management specialist. “Since 2003, cropland values have increased at an average annual rate of about 13%, with the sharpest increases occurring since 2007. This surpasses an eight-year period of strong growth in the 1940s. The strongest run up in cropland values during the past 100 years was a nine-year period (1973 through 1981), which averaged 18% annually. However, land values then dropped 40% from 1981 through 1988. It was 24 years (2005) before values again reached those that were achieved in 1981.”

The prime drivers behind this strong upswing in land values are the usual suspects -- very profitable crop production and low interest rates.

The largest increase in cropland values was 28% in the southeastern region (to $2,120), followed by increases of 22% (to $2,195 per acre) in the northern Red River Valley, and 17% to 19% for the east-central (to $1,425), southern Red River Valley (to $3,083) and the northeastern regions (to $1,246). Cropland values increased 15% in the south-central region to $1,017. The smallest increases, 12% to 13%, occurred in the northwestern region (to $666), southwestern region (to $816) and north-central region (to $1,032).

“The survey indicated that land rents, as typical, did not change as much in percentage as land values,” Swenson says. “On average, cropland rents increased about 6%. This was still a strong increase from a historical perspective.”

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COMMENTS (1 Comments)

Little Gary - IN
This series called "your precious land" should be renamed "rich farmers worship their land" because that is just what is happening. Farmland prices are out of control, a huge bubble that will land very hard with higher interest rates in the near future. All these rich farmers are bidding up land, mostly with government subsidized borrowed money (Farm Credit system). Also, the corn ethanol fraud that these rich farmers and the ag lobby are perpetrating on the average person is not only immoral, its just plain irrational. Corn ethanol is raising food prices for us all and rich farmers and agribiz benefit but the average person loses big time via higher food prices, higher taxes, less gas mileage and evironmental destruction caused by massive amounts of pesticide and fertilizer thats being dumped on the land to runoff into our waterways.
8:53 PM Apr 8th
 

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