Cash Rents Fall for 2016

August 25, 2016 11:32 AM
 
corn

 Cash rents fell nationwide along with farmland values in 2016, according to USDA. 

On average, cash rents declined nearly 6% to $136 per acre, while cropland value fell $40 to $4,090 per acre and agricultural land fell $10 to $3,010 per acre.

For farmers in Illinois, who saw average income declines of $72 an acre, with cash rents of  $290 per acre representing their largest expenditure, negotiating lower cash rents for 2017 should be considered, according to Prof. Gary Schnitkey, ag economist with University of Illinois at Champagne-Urbana, commenting in  a recent edition of FarmDoc Daily.

Why? Because the decline in cash rents isn't enough to offset the drop in commodity prices.

Cash rent for irrigated land fell slightly, dropping just $3, from $209 to $206 per acre.  Cash rent for non-irrigated land declined 8% to $125 per acre, while pastureland dropped $1 to $13 per acre, USDA said.

Higher commodity prices, boosted by increased corn use in making ethanol, propped up cash rents between 2006 and 2014, Schnitkey notes.

 

 

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Comments

 
Spell Check

Mark henzler
Pierce, NE
8/27/2016 01:06 PM
 

  You said that cash rent should down but you didn't figure in the real estate taxes which that has to be paid too and the value rations haven't come down yet but going higher every year which the cash rent should go up or stay the same as it was year before. Taxes in pierce county is higher compare to other county

 
 
JLL
Hershey, NE
9/20/2016 08:33 AM
 

  You are right Mr. Henzler. Land taxes have doubled in the last 4-5 years so rents have to stay close to what they are now. My land values have also increased by 8 to 10% each year for the same period of time. Just hope for the best.

 
 

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