Ames, Iowa – Rental rates for Iowa farmland increased for the first time since 2013, according to the results of a new survey.
The Cash Rental Rates for Iowa 2018 Survey was conducted by Iowa State University Extension and Outreach.
Alejandro Plastina, assistant professor in economics and extension economist at Iowa State University says that cash rents seem to be following land values instead of expected farm profitability. He says that if current prospects for corn and soybean prices don’t improve in the short run, the observed increase in cash rents for 2018 might be short-lived. He says that he would expect further declines in rental rates in the coming years.
In 2018, rental rates increased by 1.4 percent to $222 per acre statewide, with increases in prices shown in all regions but the south-central and southeast regions. The largest increase in prices came from District 5, a $9 jump in the counties making up the central region of the state. The largest decline in prices came from District 9, a $6 drop in the counties making up the south-central region of the state.
The cumulative drop in rental rates since their peak of $270 per acre in 2013 is a meager 17.8 percent. Over the same period of time, corn and soybean prices received by Iowa farmers declined by 52 and 37 percent, respectively.
Rental values were estimated by asking people familiar with land rental markets what they thought were typical rates in their county. Of the 1,596 responses received, 47 percent came from farm operators, 29 percent from landowners, 13 percent from professional farm managers and realtors, 9 percent from agricultural lenders and 2 percent from other professionals.
Extension experts tell us that the Cash Rental Rates for Iowa 2018 Survey is available online from the Iowa State Extension Store and Ag Decision Maker.
