Fueled by strong farm income and low interest rates, farmland values soared more than 20 percent in the central Plains during 2021, according to a quarterly survey of ag bankers by the Kansas City Federal Reserve Bank. A majority of the lenders said they expected values to increase this year, but an equally large number "also indicated that farmland values were currently over-valued, suggesting there may still be future risks of declines," said the regional Fed.
In agricultural lore, the absentee landlord is often a resented figure, an outsider who reaps an income from the labor of the farmer and takes away the profits rather than investing in the local community. The modern-day situation is more nuanced, says a USDA study which finds that, for the most part, "non-operating landlords" (NOLS) live fairly close to their property.
U.S. farm numbers continue to drift lower, dropping to 2.048 million according to a USDA survey conducted last June, only a shadow of their peak during the Depression. At the same time that the total falls, the portion of land operated by the biggest farms, the powerhouses with more than $1 million a year in sales, continues to grow, now covering a quarter of all farmland.
Billed as "the magazine of the American landowner, The Land Report says the largest 100 landowners in the nation acquired an additional 2 million acres during 2017, an area larger than Delaware. All told, the 100 largest private land holders own 40.2 million acres, equivalent to the land mass of the New England states with Vermont excluded, said the Washington Post.
The great majority farmers under the age of 35 hold a college degree, significantly higher than the U.S. average. It is a cohort that "is already contributing to the growth of the local-food movement and could help preserve the place of midsize farms in the rural landscape," says the Washington Post. It cites the 2012 Census of Agriculture as saying the number of farmers under the age of 35 is increasing for only the second time in a generation.
Congress has adjusted the enrollment cap on the Conservation Reserve, which pays landowners an annual rent to idle fragile land, in every farm bill since the program was created in 1985. With commodity prices in a trough, there are calls for a sizable increase in the reserve, a step that could affect wheat production far more than corn or soybeans according to a back-of-the-envelope estimate.
After a roundtable discussion with beginning farmers in Iowa, Agriculture Secretary Tom Vilsack said their chief concern is finding land so they can set up their operations. "The continued focus on the estate tax makes no sense to me," said Vilsack, referring to the idea, popular in the farm sector, of abolishing the estate tax.
The worldwide spike in food prices nearly a decade ago set off a land-buying surge by wealthy investors and nations wanting to shore up their food supply by acquiring cropland in developing nations. The surge was decried by critics as land grabs that would displace small farmers and herders. "The emerging new trend we wrote about in 2008 has continued and become worse," says the nonprofit Genetic Resources Action International (GRAIN).
Some members of New York City Council want to allocate $50 million from the city budget pay farmers to keep farming in Hudson Valley, reports The New York Times.
Nine of 10 New England farmers likely to retire in the coming two decades "are farming without a young farmer alongside them," raising questions about the future of many of the farms, says a study from American Farmland Trust and Land for Good.
Farmland Partners Inc. says it has closed on a previously announced purchase of 22,100 acres of farmland near Paris in east-central Illinois in a deal valued at $197 million.
The founder of a $100 million investment fund that wants to buy and restore ranch land in Texas, with hunting and fishing habitat in mind, expects to buy land at a substantial discount soon. "The timing couldn't be more perfect," Jay Ellis told the New York Times. Oil prices are tumbling and in Texas, that means land values will slide, too.
The U.S. investment giant TIAA-CREF "prides itself on upholding socially responsible values," including environmental sustainability and respect for land rights, reports the New York Times. "But documents show that TIAA-CREF’s forays into the Brazilian agricultural frontier may have gone in another direction."
Farmland values and rental rates declined modestly in the first half of the year, "and it appears that downward pressures are likely to continue into 2016," say economists Gary Schnitkey, Bruce Sherrick and Todd Kuethe of U-Illinois. "While headwinds related to farm income will likely continue, current farmland prices do not appear out of line with current cash rent and interest rate levels."
The grim joke in agriculture is that, considering the cost of land and equipment, the only way to become a farmer is to be born into a farm family or marry into one. A recent USDA survey underlined the hurdle of acquiring land, finding that landlords prefer to keep ownership in the family and expect to sell a comparatively modest 21 million acres to outsiders over the next five years. "This means that only a small percentage of farmland will be available for new entrants into the farming sector," said USDA. Agriculture Secretary Tom Vilsack is considering an in-depth study of the land-access question. "We're working on that concept," he told the James Beard Foundation conference.