Appraisal Update Finds Steady to Slightly Lower Farmland Values

Posted on 01/15/2020 11:18 AM

Western Corn Belt farmland values were steady to slightly weaker during the last half of 2019, according to the semi-annual benchmark farms appraisal update conducted by Farm Credit Services of America (FCSAmerica) and Frontier Farm Credit.

The Omaha-based FCSAmerica serves Iowa, Nebraska, South Dakota and Wyoming while Frontier Farm Credit serves eastern Kansas. Twice a year, the appraisal teams for the two lenders update their assessment of the 71 benchmark farms throughout their service areas.

The January update finds the 71-farms on average declined 0.8% in the last half of 2019. The update, however, found slight variations throughout the western Corn Belt. Iowa, for instance, notched an overall 0.7% increase; Kansas slipped 1.2%; Nebraska declined 2.6% and South Dakota edged 1% lower. Wyoming, however, rose 2%.

“While most state-wide average farmland sale prices showed a slight increase during the fourth quarter, a more regional look showed that farmland sale prices were relatively steady or down slightly across much of the Associations’ territory compared to a year ago,” the firms report. “Quality of land sold has not changed substantially over the past few years. The overall availability of dry cropland appears to have decreased as reflected by lower sale numbers in all states when compared to 2018 sale totals. Irrigated cropland sales declined in Nebraska compared to a year ago.”

According to the two lenders, the six-month benchmark farm trends indicate:

• State average Iowa benchmark farm values increased by +0.7% over the past six months, yet decreased 0.6% over the last year. Of the 21 benchmark farms, only two decreased in value and ten increased in value over the past six months. Nine farms showed no change in value.

• The benchmark farms in Kansas decreased by 1.2% over the most recent six-month period. Three of the seven farms showed a decrease in value, one showed a slight increase in value, and three showed no change over the past six months. During the past year, benchmark values declined by -4.1%.

• Nebraska benchmark farm values decreased 2.6% over the past six months and 2.9% during the last year. Ten of the eighteen farms declined in value while four increased in value. Four showed no change in value over the past six months

. • Overall benchmark farm values in the state of South Dakota decreased 1.0% over the last six months and declined 1.7% since January 2019. Seventeen of the twenty-three benchmark farm values experienced no change over the past six months. Only one farm increased in value while five farms decreased in value.

• Wyoming’s two benchmark farm values increased +2.0% over the last six months. The one cropland farm experienced a 4.0% increase while the pasture unit experienced no change in value over the past six months. Over the past year, benchmark values increased 8.6%. Sales have been and continue to be very limited in this market area.

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