Commodity prices, interest rates, and input costs helped drive prices down

Ames, Iowa –The annual Iowa State University Land Value Survey found that farmland values decreased 3.1%, or $369, to $11,467 per acre. The decrease this year nearly erases the 3.7% increase from last year and ends a five-year trend of increasing prices. The nominal value of an acre of farmland this year fell from last year’s record high, but is still higher than the nominal value in 2022. When adjusting for inflation, the 2024 average value is 2.5% lower than 2013’s inflation-adjusted values.

“We saw land values rise for five straight years, including surges of 29% and 17%, which naturally leads to a reset or balancing in the market,” said Dr. Rabail Chandio, who is responsible for the annual survey. “If we look back to the previous peak in 2013, the market "adjusted" with relatively small declines spread over a few years.”

Chandio said that survey respondents noted falling commodity prices, persistently high interest rates, and elevated input costs as factors that have tightened profit margins and placed increasing downward pressure on land values across the state.

While the Federal Reserve started cutting rates in late 2024, Chandio said the impact of the past two years of high interest rates is still weighing on farmland values. “It takes time—sometimes up to a decade—for interest rate changes to fully ripple through the land market; and, although rates recently dropped, with another cut on the horizon, it’s not enough yet to ease the pressure from those earlier hikes as we move into 2025. If rates fall within a couple of years, we could see farmland values beginning to recover sooner. But if rate cuts take longer, we may see declines persist for another year or two,” she said.

The lower commodity prices will also affect more than just land values—farm income is expected to fall 4.1% this year, following last year’s 17.4% drop, as lower commodity prices weigh on crop cash receipts. “While crop receipts are down, livestock receipts are up 8.4%, offering some balance. So, livestock markets, like cattle and hogs, have fared relatively better, but high input costs are still exerting enough pressure to keep margins very tight,” Chandio said.

Iowa’s South Central crop reporting district was the only district to see an increase in land values. Chandio said that when land values in other parts of the state surged during the COVID-19 pandemic, the southern districts lagged behind. “While the South Central district saw an increase this year, the other two southern districts reported only minimal decreases, indicating a relatively stable trend overall,” Chandio said.

Looking forward, survey respondents had a clear distinction between their short-term and long-term expectations for land values. Over the next year, 58% expect declines, with most predicting drops of less than 5%. However, looking further ahead, respondents are much more optimistic—80% believe land values will increase over the next five years, with 36% forecasting gains of 10%–20%. “This long-term confidence aligns with expectations of more stable or slightly rising corn and soybean prices, suggesting that while the short-term outlook may be challenging, the market’s foundation remains strong,” Chandio said.

Land Values by County
Seventy-five of Iowa’s 99 counties showed a decrease in land values. O’Brien County topped the list this year with a per-acre value of $15,921, though values there decreased 2.4%, or $392, per acre since last year. Appanoose County reported the lowest value, $6,840 per acre; however, those values are an increase of $486, or 7.7% per acre.

Shelby County saw the largest dollar decrease with a loss of $1,170 per acre. Harrison County saw a decrease of 9.7% per acre, the largest percentage loss by county. Wayne County saw the largest dollar increase, $690, in average values; however, Decatur County saw the largest percent increase in values at 10.5%. Osceola County reported the lowest percentage and dollar increase at less than 0.1% and $3 per acre, respectively.

Land Values by District
In a reversal from last year, land values decreased in eight out of nine crop reporting districts. The West Central district saw the largest percent decrease (down 7.4%) and the largest dollar decrease (down $943) per acre, bringing average acre prices there to $11,798. The Northeast district saw the smallest percent decrease (down 1.5%) and the smallest dollar decrease occurred in the Southwest district, where average per-acre prices fell $165.

The South Central district is the only district that reported an overall percentage and dollar increase (up 3.6%/$272 per acre), brining average land values there to $7,754 per acre.

Average prices are now highest in the Northwest ($14,109/acre) district and lowest ($7,754/acre) in the South Central district.

Land Values by Quality
Statewide, low-quality land now averages $7,450 per acre, a decrease of 2.8% or $215 per acre. Medium-quality land now averages $10,740 per acre, a decrease of 3.0% or $335 per acre. High-quality land now averages $13,930 per acre, a decrease of 2.6% or $367 per acre.

The Northwest district again reported the highest values for low-, medium-, and high-quality land at $9,162, $12,975, and $16,171 per acre, respectively. Despite being only district to see an overall increase (3.63%), the South Central district reported the lowest values for low-, medium-, and high-quality land at $5,071, $7,864, and $10,659 per acre, respectively.

In terms of both percentage and dollar amounts, the West Central district saw the largest declines in low-, medium-, and high-quality land, and average land values, with values falling 7.4% or $943 per acre on average.

Low-quality land in the West Central district saw the largest percent decrease (11.5%) and the largest dollar decrease ($1,043 per acre). Low-quality land in the Central district saw the largest percent (5.1%) and dollar increase ($404) in per-acre value.

Medium-quality land saw the largest percent decrease (7.7%) and dollar decrease ($928 per acre) in the West Central district. The South Central district saw the only increase in medium-quality land values in terms of percentage (up 4.9%) and dollar change (up $366 per acre).

High-quality land saw the largest percentage decrease (7.1%) and dollar decrease ($1,059 per acre) in the West Central district. The South Central district reported the only increase in high-quality land in terms of percentage (9.7%) and dollar value ($940 per acre).

Factors Influencing the Land Market
The most frequently mentioned negative factor affecting land values was lower commodity prices. Other negative factors included long-term interest rates, higher input costs, cash/credit availability, weather, inflation, and an uncertain agricultural future.

The most frequently mentioned positive factor influencing the land market was limited land supply. Strong yields and cash/credit availability were the second- and third-most frequently mentioned factors. Other frequently mentioned positive factors included strong demand for land (including that from investors), favorable interest rates, and a good farm economy.

Land values were determined by the 2024 Iowa State University Land Value Survey, conducted in November by the Center for Agricultural and Rural Development at Iowa State and Iowa State University Extension and Outreach. Results from the survey are consistent with results by the Federal Reserve Bank of Chicago, the REALTORS® Land Institute, and the U.S. Department of Agriculture.

The Iowa State Land Value Survey is based on reports by agricultural professionals knowledgeable of land market conditions, such as appraisers, farm managers, agricultural lenders, and actual land sales, and is intended to provide information on general land value trends, geographical land price relationships, and factors influencing the Iowa land market. The 2024 survey is based on 479 usable responses from 330 agricultural professionals. Sixty percent of the 330 respondents answered the survey online.

The Iowa State Land Value Survey was initiated in 1941, the first in the nation, and is sponsored annually by Iowa State. The survey is typically conducted every November and the results are released mid-December. Only the state average and the district averages are based directly on the Iowa State survey data. County estimates are derived using a procedure that combines the Iowa State survey results with data from the U.S. Census of Agriculture.

CARD offers a web portal at https://farmland.card.iastate.edu that includes visualization tools, such as charts and interactive county maps, allowing users to examine land value trends over time at the county, district, and state level.

For over 60 years, the Center for Agricultural and Rural Development at Iowa State University has conducted innovative public policy and economic research on local, regional, and global agricultural issues, combining academic excellence with engagement and anticipatory thinking to inform and benefit society.

Contacts:
Rabail Chandio, 515-294-6181; rchandio@iastate.edu
Nathan Cook, Communications, 515-294-3809; nmcook@iastate.edu

A recent study found that while concern about the negative impacts of climate change can reduce job satisfaction, farmers who have more resilient systems were more likely to report higher job satisfaction.

AMES, IA – An innovative study has shed light on the factors that influence job satisfaction among farmers. Published in the June issue of Rural Sociology, the study, “What’s Good for the Land is Good for the Farmer: Investigating Conservation-Related Variables as Predictors of Farmers’ Job Satisfaction,” explores how economic dynamics, farm financial health, soil and water conservation, and climate change concerns impact farmers’ job satisfaction and dissatisfaction.

The study, conducted by J. Arbuckle, Henry A. Wallace Chair for Sustainable Agriculture at Iowa State University, and Lijing Gao, assistant professor of agricultural science communication at the University of Missouri, comes at a time when the farming community is grappling with increasing stress, mental health issues and suicide rates. The unique challenges of farming, which include both positive and negative aspects, necessitate a deeper understanding of what drives job satisfaction in this sector. Using data from the 2020 Iowa Farm and Rural Life Poll, an annual survey of Iowa farmers, the researchers evaluated various predictors of job satisfaction and dissatisfaction.

Key findings
The study identified multiple factors that influence job satisfaction among farmers. As expected, farm financial health plays a significant role in determining job satisfaction. Farmers who reported better farm economics were more likely to be satisfied with their jobs, whereas those experiencing financial difficulties tended to be dissatisfied.

Another important factor is stewardship motivations, which refer to the commitment to soil and water conservation. Farmers who had strong stewardship motivations and believed that their conservation practices were adequate reported higher levels of job satisfaction. On the other hand, when there was a misalignment between their stewardship goals and satisfaction with practices implemented, it led to greater job dissatisfaction.

The study also highlighted the impact of extreme weather events on job satisfaction.

Interestingly, farmers who had successfully coped with extreme weather events reported higher job satisfaction. This suggests that overcoming such challenges can enhance farmers’ sense of competence and, hence, satisfaction with their occupation.

On the other hand, concerns about climate change were found to negatively impact job satisfaction. Farmers who were worried about the long-term effects of climate change on their operations were less likely to be satisfied with their jobs.

“While we found climate change concern was a drag on job satisfaction, the finding that job satisfaction is positively related to successful coping with extreme weather and perceived adequacy of conservation practices is really important. It suggests that farmers who have more resilient farming systems are happier with their jobs,” Arbuckle said.

The role of crop insurance as a revenue protection strategy was also examined. The study found the belief that crop insurance would protect their farm’s revenue from the potential impacts of climate change was related to lower levels of job dissatisfaction. In other words, farmers who felt that crop insurance would be an effective revenue protection strategy were less likely to be dissatisfied with their jobs.

These findings highlight the importance of financial stability, effective conservation practices, resilience in the face of extreme weather, and confidence in crop insurance in shaping farmers’ job satisfaction and overall well-being.

“Understanding the factors that influence farmers’ job satisfaction is crucial for developing effective support programs,” Gao said. “Our study highlights the importance of financial health and stewardship motivations in shaping farmers’ job satisfaction.”

Implications for policy and programs
The findings have implications for agricultural policy and programs. The researchers propose that a focus on the potential job satisfaction benefits of resilient production systems could help conservation professionals promote increased adoption of soil and water conservation practices. This could enhance both farmers’ well-being and the sustainability of agricultural systems.

Funding for the project came from the Iowa Agriculture and Home Economics Experiment Station.

University of Missouri

Contacts:
Lijing Gao, University of Missouri; lghbc@missouri.edu
J. Arbuckle, Department of Sociology and Criminal Justice; arbuckle@iastate.edu

Ames, IA – A news conference will be held at 10:00 a.m. on Tuesday, December 17 to announce the results of the 2024 Iowa Land Value Survey conducted by the Center for Agricultural and Rural Development at Iowa State University and Iowa State University Extension and Outreach. The conference will take place in room 0008 of Curtiss Hall on the Iowa State campus in Ames.

For those who can’t attend the conference, a livestream will be available on YouTube at http://bit.ly/landresults2024.

Rabail Chandio, assistant professor of economics and farm management specialist, will head the news conference and announce the 2024 findings. Printed materials will be provided at the conference, including Iowa land value data from 1950 to present, current land value data from all 99 counties, and a press release summarizing the 2024 results. Dr. Chandio will make herself available to reporters for follow-up questions or one-on-one interviews immediately following the presentation of results.

The Iowa State Land Value Survey is currently ongoing, if you are an agricultural professional knowledgeable about the farmland market who has not participated in this year’s survey, you can participate in the Iowa State Land Value Survey online by December 1 at https://bit.ly/landvalue2024. If you have questions regarding the survey, please contact Dr. Rabail Chandio at rchandio@iastate.edu or call 515-294-6181. You can also see the land value trends at the county, district, and state level since 1950 at the interactive Iowa Farmland Value Portal at https://www.card.iastate.edu/farmland/.

An archive of the video and the printed materials available at the conference will be posted on the CARD homepage at https://www.card.iastate.edu soon after the conference.

Contacts:
Rabail Chandio, 515-294-6181; rchandio@iastate.edu
Nathan Cook, Communications, 515-294-3809; nmcook@iastate.edu