Indiana farmland prices soar to record highs in 2022

WEST LAFAYETTE, Ind. – The Purdue Farmland Worth and Money Rents Survey suggests Indiana farmland costs grew at a document tempo between June 2021 and June 2022, exceeding earlier highs set in 2021. Statewide, top-quality farmland averaged $12,808 per acre, up 30.9% from the identical time final yr. The typical per acre value of average-quality farmland equally elevated by 30.1% to $10,598. Poor high quality farmland costs exhibited the biggest enhance of 34.0% to $8,631.

“A number of components are influencing the rise in farmland costs, together with constructive web farm incomes, comparatively robust commodity costs, inflation, and excessive farmer liquidity,” stated Todd H. Kuethe, Purdue affiliate professor and the Schrader Endowed Chair in Farmland Economics and survey creator. “Nevertheless, rising rates of interest are related to elevated prices of borrowing, which put downward stress on purchases financed by mortgages.”

Statewide money rental charges additionally elevated throughout all land high quality courses in 2022. Common money rents elevated by 11.5% for top-quality land, 10.8% for average-quality land, and 13.2% for poor-quality land. The will increase in money rents have been the best noticed for the reason that 2011–2012 interval. Throughout the three high quality grades, money rents additionally reached a document excessive in 2022 at $300 per acre for high-quality farmland, $252 for average-quality, and $207 for poor-quality land. On the regional stage, the biggest money rental charge will increase for top- and average-quality land have been within the Northeast (21.3% and 13.2%, respectively), and the biggest enhance for poor-quality land was within the Southwest area (18.6%). Throughout all three high quality grades, the best per acre common money lease was noticed within the West Central area.

Whereas rental charges throughout all three high quality grades elevated in nearly all areas, the money rental charges grew at a slower charge than market costs. In consequence, lease as a share of land worth declined relative to 2021.

The value appreciation charges for farmland transitioning out of agricultural manufacturing or offered for leisure functions surpassed the earlier document progress charges noticed in 2011. Statewide, the typical value of transitional land was up 36.5% from June 2021, with a mean value per acre of $24,240. Leisure land costs grew by 21.8% to a mean per acre value of $9,121. For the rest of 2022, respondents anticipate transitional land to extend modestly by 2.3%, whereas the worth of leisure land is predicted to carry comparatively steady.

For extra in-depth evaluation on the survey, the Purdue Heart for Industrial Agriculture will host a free webinar 1-2 p.m. ET Aug. 24. Be a part of Purdue agricultural economists Todd Kuethe, James Mintert and Michael Langemeier as they break down the Purdue Farmland Values Survey and USDA Land Values report, talk about advertising methods for 2022 corn and soybean crops, and make projections for 2023 corn and soybean returns. Register for the free webinar at https://purdue.ag/landvalues2022.

Purdue’s Division of Agricultural Economics conducts the Purdue Farmland Worth and Money Lease Survey every June and publishes it within the Purdue Agricultural Economics Report. The survey is produced by the cooperation of quite a few professionals educated of Indiana’s farmland market. These professionals offered an estimate of the market worth for naked poor, common, and top-quality farmland in December 2021, June 2022, and a forecast worth for December 2022.

Author: Kami Goodwin, kami@purdue.edu

Source: Todd H. Kuethe, tkuethe@purdue.edu

Agricultural Communications: 765-494-8415;

Maureen Manier, Division Head, mmanier@purdue.edu

Agriculture Information Web page