The value of Illinois farmland showed only a minor decline in 2014, according to the annual survey conducted by the Illinois Society of Professional Farm Managers and Rural Appraisers. The survey found Illinois farmland edged 1% to 3% lower, based on the quality of farmland.
Excellent-quality farmland reflected a decline of just 1%, to a statewide average of $12,700 an acre. Good-quality farmland slipped 3% to a statewide average of $9,300 an acre. Average-quality farmland eased 2% lower to a statewide average of $7,100 an acre. The survey also found a recreational farmland held steady to slightly stronger with stronger values noted in areas with easy access to the Chicago or St. Louis metro areas. Sales volume for this type of farmland rose slightly, as well. Transitional farmland was also listed as steady in the survey.
The survey found local farmers accounted for 66% of buyers of Illinois farmland with local investors coming in second at 13%.
Rental Rates: The survey found general declines in rental rates as well, according to Dr. Gary Schnitkey, University of Illinois, who compiled results from the rental portion of the survey. "Traditional crop share income on Excellent productivity farmland was $70 per acre lower in 2014 compared to 2013," he reports. "Cash rents across all farmland classes fell by $28 per acre for good-quality farmland; $27 per acre for average-quality farmland; and $19 per acre for fair-quality farmland.”
Moving forward: “Eighty percent of Survey respondents expect that cash rents for 2016 will decrease modestly in 2016,” he says. “We asked what would happen to rents if yields are normal and fall prices are near $3.50 per bushel for corn and $10 per bushel for soybeans. Ninety two percent expect cash rents would decrease by more than $10 per acre given this scenario,” Schnitkey said.
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