Farmland values in the Western Corn Belt appear to have adjusted to a new normal, according to Farm Credit Services of America (FCSAmerica). Even with seasonal fluctuations, farmland values have remained generally consistent since 2015, states the Omaha-based farm lender. FCSAmerica serves Iowa, Nebraska, South Dakota and Wyoming.
"Farmland values are largely dependent on geography and have adjusted to reflect their market's current supply and demand," says Tim Koch, chief credit officer for FCSAmerica, which tracks the values of 64 benchmark farms in Iowa, Nebraska, South Dakota and Wyoming.
Farmland values peaked in the last half of 2013 in FCSAmerica's lending territory. Nearly five years later, Iowa has seen the largest drop in values at 17.8%, followed by Nebraska at 17.6%. South Dakota's farmland is off 10.8% since it peaked in the fourth quarter of 2013.
Twelve of Iowa's 21 benchmark farms increased in value in the first six months of 2018, while eight showed no change and one decreased in value. In Nebraska, nine benchmark farms increased in value, seven declined and two showed no change. Twelve benchmark farms in South Dakota showed no change in value, three increased and eight decreased in value. Wyoming's cropland benchmark farm experienced a 1.0% increase in value, while a pasture unit saw no change.
FCSAmerica appraises its benchmark farms twice a year, in January and July. In addition, the cooperative compiles records from farmland sale in its four states. The cooperative's objective in using the benchmark farms is to track real estate values without the influence of changes in land quality on sale prices.
Overall, farmland prices and the quality of land held steady through the first half of 2018. Public land auctions increased 56% in South Dakota, 23% in Iowa and 7% in Nebraska. However, the overall availability of farmland was unchanged from 2017, with private and Realtor sales declining in each state.
See below for state-by-state changes in sale prices. (Wyoming continues to see very limited sales activity.)