View from the Cab: Upward land move
By: Kent Casson
Prices paid for Illinois farmland continue their upward move, a trend that applies to all classes of farmland across the entire state.
This information was released last week during the 2023 Illinois Farmland Values Conference sponsored by the Illinois Society of Professional Farm Managers and Rural Appraisers.
According to Luke Worrell, AFM, ALC, Worrell Land Services, Jacksonville, IL, overall chair of the event, 2022 continued to see a sharp rise in land values. While certain pockets of Illinois experienced more strength than others, in general, Illinois land was up across the board.
Across all of the regions that have “Class A” Excellent acreage, there was an increase of 16 percent. “Class B” Good farmland was up 17 percent, “Class C” Average up 7 percent, “Class D” Fair up 7 percent and recreational land was up 17 percent on average.
“If you factor in 2021 results, Class A land across Illinois saw an increase of over 45 percent during a 24-month time span,” Worrell explained. “While premium acreage always carries the flag, lesser quality acreage saw increases in excess of 25 percent and in some instances over 40 percent over the same time period.”
Mixed use and recreational properties have seen a strong increase as well with this year’s study showing an increase of 14 percent in 2022 alone.
Reduced transactions in 2020, historically low interest rates, strong demand, increased commodity markets and overall fear in other economic sectors all played a role in the groundswell, according to Worrell.
“In many parts of Illinois, we saw a huge number of transactions throughout the first few months of 2022. In my own area, if you wanted to know what the record price was, you only had to look up how the latest auction performed.”
Cash rents are higher as well. Average cash rent levels increased substantially from 2022 to 2023 for all land productivity classes with the higher quality land experiencing the greatest absolute increase.
For Excellent productivity farmland, the $412 per acre cash rent for 2023 was $43 higher than the $369 per acre cash rent in 2022. Cash rents for Good quality land increased by $31 per acre from $322 in 2022 to $353 per acre in 2023. Average quality farmland increased from $275 per acre in 2022 to $285 per acre in 2023, an increase of $10 per acre.