Results of the Purdue Farmland Value and Cash Rents Survey, published in the August 2021 Purdue Agricultural Economics Report, suggests farmland prices across Indiana rose to all-time highs in June of 2021. Statewide, top quality farmland averaged $9,785 per acre, up 14.1% from the same time last year. The high growth rate for top quality farmland was closely followed by the growth in average and poor quality farmland prices, which increased by 12.5% (to $8,144) and 12.1% (to $6,441), respectively. Across all land quality classes, 2021 per acre farmland prices exceeded the previous records set in 2014.
“A unique combination of economic forces including net farm income, expected income growth, crop and livestock prices, interest rates, exports, inflation, alternative investments, U.S. policy, and farmers’ liquidity, all played a major factor in the price increase we’re experiencing,” said Todd Kuethe, Purdue associate professor and Schrader Endowed Chair in Farmland Economics and survey author.
And, according to Kuethe, that’s pretty rare. “Normally we’ll see positive price pressure from one or two market forces; however, this June, survey respondents indicated that all ten forces we asked them about were putting upward pressure on land values.”