Purdue’s annual land rent survey valuable tool

Monday, August 13, 2018

By: Jenna Nees/Extensnion Educator

Throughout the year, many individuals ask what the “going rate” is for farmland rental prices. That is a difficult question to answer.

The rate fluctuates and is highly dependent on the individual farm ground being discussed.

That is why when asked, Purdue Extension provides a range of values based on the annual Purdue Farmland Value Survey and stresses the importance of not simply utilizing the values given. Instead, landlords and tenants are told the final rental amount will need to be adjusted based on numerous items, including the size of the field, drainage, soil fertility, ease of access for farm equipment and much more.

As a whole, the 2018 Purdue Farmland Value Survey found the average value of bare Indiana cropland slightly increasing. The average value of bare Indiana cropland ranged from $5,407 per acre for poor quality land (a 2.4 percent increase from 2017) to $8,668 per acre for top quality land (a 1.6 percent increase from 2017). The average corn yield for poor quality land was141 bushels per acre and 204 bushels per acre for top quality land.

The 2018 survey average for Indiana cash rent increased. On average, cash rents range between $168 per acre for poor quality land and $261 per acre for top quality land. Cash rents increased by 3.1 percent for poor quality land and 3.2 percent for top quality land since June 2017.

The value for farmland moving out of agriculture (transition land) increased this year. The survey revealed there was a 19.1 percent increase in the average value of transition land since June 2017. The average value of transition land in June 2018 was $13,171 per acre. The average value of recreational land decreased by 4.9 percent since June 2017. The average value of recreational land in June 2018 was $3,541 per acre.

It is important to note that transition and recreational land values are quite volatile and have a wide range of values.

For individuals in our area it is probably of more importance to look at the results for the West Central Region. The West Central Region (consisting of Benton, Carroll, Fountain, Montgomery, Parke, Putnam, Tippecanoe, Vermillion, Warren and White counties), had cropland values that ranged from $6,245 per acre for poor quality land and $9,452 per acre for top quality land.

Cash rents for the West Central Region varied from $199 per acre for poor quality land to $297 per acre for top quality land (average quality land was $245 per acre). For the West Central Region, cropland values and cash rent values increased from 2017 to 2018.

The average corn yield for poor quality land was 154 bushels per acre and 212 bushels per acre for top quality land in this region.

Producers may also want look at values for the Southwest Region due to the similarities in topography and soil productivity. The Southwest Region (consisting of Clay, Daviess, Dubois, Gibson, Greene, Knox, Martin, Owen, Pike, Posey, Spencer, Sullivan, Vanderburgh, Vigo and Warrick counties), had cropland values that ranged from $4,032 per acre for poor quality land and $8,874 per acre for top quality land.

Cash rents for the Southwest Region varied from $143 per acre for poor quality land to $263 per acre for top quality land (average quality land was $196 per acre). For the Southwest Region, cropland values decreased, while cash rent values increased from 2017 to 2018.

The average corn yield for poor quality land was 130 bushels per acre and 212 bushels per acre for top quality land in this region.

To obtain your own copy of the 2018 Purdue Farmland Value Survey, contact your local Extension Office or go to www.agecon.purdue.edu/extension/pubs/paer.

Visit www.extension.purdue.edu/putnam or you can contact the local Purdue Extension Office by calling 653-8411 for more information regarding this week’s column topic or to RSVP for upcoming events. It is always best to call first to assure items are ready when you arrive and to RSVP for programs. While many publications are free, some do have a fee.

Upcoming Events

Aug. 3-19 – Indiana State Fair.

Aug. 14 – What Does It Mean to Diversify My Farm webinar, noon, RSVP at https://ag.purdue.edu/Extension/wia/Pages/webinars.aspx.

Aug. 15 – My Record of Achievement 4-H workshop, 6:30-7:30 p.m., Extension Office.

Aug. 21 – Quick and Easy Meals to Take to the Field webinar, noon, RSVP at https://ag.purdue.edu/Extension/wia/Pages/webinars.aspx.