Land Prices are Dazzling


Junior Member
Rabobank Releases US Farmland Values Report

By Graham Dyer,

Rabobank, a global leader in agriculture and food finance, today released its US farmland values report. The report indicates that farmland continues to rise dramatically in price; with 2011-2012 increases in excess of 15 per cent in many regions. Contributing factors to this land value increase are the rising commodity prices, low interest rates, and strong land rental rates. This continues a positive six year trend.

The states of Iowa, North Dakota, South Dakota, Nebraska and Illinois are featured as some of the most ?dazzling? states ; where increases of land values were reported in the range of 16 to 25 per cent.

The Rabobank report states ?looking ahead to the first half of 2013, US farmland values are expected to increase at a slower rate than in 2011 and 2012.?

The Rabobank report provides an excellent review of the market movement in farmland, as well as the contributing factors that drive this result.

From a business management perspective, it is always important to review the past experience, but it is also important to think about the future market direction.

The Risk Management team has written a number of articles about the 2012 drought that has impacted much of North American crop land. We believe that this drought will also have an interesting impact on future land values. However, the extent and direction of this impact, is uncertain as of yet.