Farm real estate value, cash rent fall

The decline in corn and soybean prices has resulted in lower Iowa farm real estate values and cash rent.

The state's farm real estate value - a measurement of the value of all land and buildings on farms - averaged $8,000 per acre, down $500 per acre or 6 percent from 2014, according to the U.S. Department of Agriculture National Agricultural Statistics Service.

The total value of land and buildings is derived by multiplying average value per acre of farm real estate by the land in farms.

Cropland value decreased 6 percent from last year to $8,200 per acre. Pastureland, at $3,400 per acre, was unchanged from a year ago.

The USDA said low grain prices weakened cropland values while record high beef prices supported pastureland values.

Cropland cash rent paid to Iowa landlords in 2015 averaged $250 per acre, down $10 from $260 per acre in 2014, according to the USDA.

Non-irrigated cropland rent averaged $250 per acre in 2015, down $10 from a year earlier. The cash rent for irrigated cropland was not published by the USDA to avoid disclosure of individual operations.

Pasture land rented for cash averaged $50 per acre, unchanged from 2014.

Cash rates to lease farmland decreased 8 percent in 2015 relative to 2014 in the Federal Reserve Bank Seventh District, which includes Iowa. That was the largest annual average decrease since 1987, according to David Oppedahl, Federal Reserve Bank of Chicago economist, in a release.

'This decline provided some relief in rental costs for farmers facing much lower crop prices than in recent years,” Oppedahl said. 'The drop in 2015 cash rents stemmed from lowered expectations for making a profit from farming rented ground in 2015.

'Faced with the possibility of acres going fallow, farmland owners seemed to have agreed to reductions in cash rents.”