Farmland values grew at the slowest pace in about six years, with some regions such as the Corn Belt showing declines, according to a government report released late Wednesday.
Nationwide, farm real estate values (including all land and buildings on farms) rose 2.4 percent to an average of $3,020 per acre in the 12 months ended June 1, according to the U.S. Department of Agriculture's 2015 Land Values report. That represents a deceleration from the 8.1 percent growth rate reported in 2014 and the slowest pace since 2010.
According to the report, the average value of cropland nationally increased by 0.7 percent to $4,130 per acre in fiscal 2015, well below the brisk 7.6 percent pace of the prior year. The average value for pastureland nationally increased to $1,330 per acre, or 2.3 percent from 2014.
(USDA analyst Rachel Antzak said the overall farm real estate category that saw 2.4 percent growth includes the value of all farmlands—not just cropland and pastureland—as well as "other things," including buildings.) The report excludes Hawaii and Alaska farmland.
The USDA data appears to show that the drought failed to put much of a dent in cropland prices in California, although the state's pastureland values were flat compared with those of 2014. In California, the average price of cropland rose by 5.4 percent to $10,690 per acre, and despite the state's worsening drought, the growth in values exceeded the 2.8 percent pace of the prior year.
In Texas, the average cropland values rose by 9.5 percent to $1,840 per acre in the latest year after jumping 10.5 percent in the 2014 report. Pastureland, however, was up a more modest 1.3 percent in the USDA's latest Land Values summary.
The average value of cropland in the Corn Belt region (including Illinois, Indiana, Iowa, Missouri and Ohio) was $6,840 per acre in the latest 12 months, down 2.3 percent compared with $7,000 per acre a year ago. That represents the first such decline in the Corn Belt region since 2009 and reflects lower corn and soybean prices.
That said, cropland prices in the Corn Belt still are up on average 75 percent since 2010 when they averaged $4,000 per acre, according to government figures. That compares with a national increase of nearly 53 percent in the same period.
Iowa had the biggest percentage drop in average cropland values within the Corn Belt, according to the government figures. Iowa cropland was worth an average $8,200 per acre in the latest 12 months, down 6.3 percent from a year earlier and sharply reversing the heady growth of 9.4 percent in the 2014 report.
Minnesota's cropland values also were down in the latest period, falling by 2.5 percent to an average of $4,750 per acre from 2014. However, Minnesota's pastureland values increased 18.8 percent from the previous year.
At an average $13,500 per acre, New Jersey had the most expensive cropland in the lower 48 states, according to the USDA report. Montana had the least expensive cropland, coming in at an average $997 per acre.