Changing Economic Fundamentals Put Pressure on Farmland Values

by Brent Gloy

In our last post we examined some of the trends in farmland values around the country. These trends indicated that farmland prices were likely heading lower in many regions of the country. This is likely the most true in the Corn Belt where grain prices have been under substantial pressure. The output price pressure has been met with stiff resistance in input prices creating a significant margin squeeze. One way that this squeeze may alleviate is with a reduction in fixed costs, most notably cash rents and farmland prices.  Indeed, recent survey results from Iowa State indicate this process is underway.  Continue reading