Farmland values declined about 3.4% in the western Corn Belt the first half of 2016, according to the semi-annual appraisal update conducted by Farm Credit Services of America (FCSAmerica), Omaha, Neb., and Frontier Farm Credit, Manhattan, Kansas. The appraisal teams of the two large ag lenders update the value of 71 benchmark farms each Jan. 1 and July 1. Frontier Farm Credit joined FCSAmerica in this semi-annual appraisal update in January 2015, which means historical data will become available for Kansas over time.
“The large decline in farmland values predicted by various real estate organizations in 2015 did not materialize; however, the softer landing that was experienced in 2015 and continues in 2016 is a correction in the market as supply and demand come back in line,” the lenders state. They also indicate the number of public auctions in their service area declined 3% from a year earlier and “overall sales activity was down in all five states.”
The value of Iowa cropland is down 5.7% on an annual basis while pastureland is down 1.8%, they report. Kansas cropland is down 0.9% but ranch/pastureland is up 0.8%. Nebraska cropland values are down 4.7% versus a year earlier and pastureland values are down 2.2%. South Dakota cropland is off 3.2% and pastureland is down 3.1% on an annual basis. Wyoming is the exception, with cropland values up 1.1% and ranch/pastureland up 20.8% — up sharply due to a lack of sales in 2015. The gain most likely occurred in early 2015, with values in 2016 most likely steady versus 2015, FCSAmerica says.