The average value of an acre of Nebraska farmland rose 6% in 2020, according to the annual Farm Real Estate Market Survey conducted by the University of Nebraska-Lincoln. The survey pegs the value of an average acre at $2,895, the second consecutive gain the since 2019.
Ag economists Jim Jensen and Jeff Stokes who conducted the annual survey note low interest rates and a $2.4 billion injection of federal payments for disaster assistance, safety net and pandemic relief provided stability to an industry facing an unpreceded economic shutdown and disruptions of supply chains.” The late-year rally in crop prices lifted prices off of pandemic lows and led to a surge in demand for farmland.
Cropland reported the highest market value increase compared to the prior year. The estimated market value of center pivot irrigated cropland rose by about 8% across the state with the northeast, central, and southeast districts reporting the strongest gains ranging between 9% and 10%. Gravity irrigated cropland followed similar trends with the northeast and southeast districts reporting increases around 8% and other regions improving in value from about 4% to 6%.
Dryland cropland without irrigation potential reported an increase of about 7% with the north, central, and southeast districts leading gains averaging between 8% and 11%. Other regions range from a low 2% in the southwest to 5% in the northeast.
Dryland cropland with irrigation potential showed a renewed interest with higher commodity prices. This land class indicated a 6% rise for the state with northwest, northeast and central regions reporting climbing values ranging from 8% to 11%. Other regions, such as the east, southwest or south reported lower gains between 3% and 5%, because of limited ability to develop additional irrigated acres due to water availability.
Improvements in grazing land and hayland market values range around 3% to 5%. Tillable grazing land led the three land classes at 5% as higher crop prices incentivized the development of additional acres. The north, east and south districts, on average, increased in a range from 5% to 8% for the three regions.
Overall, dryland and irrigated cropland reported steady to higher cash rent averages across the state. These rates averaged about 5% to 7% higher over the 2020 growing season.
Value of an Average Acre of Nebraska Farmland Rises to $2,895
Nebraska Crop Districts