Indiana Farmland Prices Hit New Record High in 2021

It is safe to say that the last year was unlike any other in recent memory. The COVID-19 pandemic caused significant disruption to our lives and the global economy. Surprisingly, many of the current economic forces put upward pressure on farmland prices.

Results of the Purdue Farmland Value and Cash Rents Survey, published in the August 2021 Purdue Agricultural Economics Report, suggest farmland prices across Indiana rose to all-time highs in June of 2021. Statewide, top quality farmland averaged $9,785 per acre, up 14.1% from the same time last year. The high growth rate for top quality farmland was closely followed by the growth in average and poor quality farmland prices, which increased by 12.5% (to $8,144) and 12.1% (to $6,441), respectively. Across all land quality classes, 2021 per acre farmland prices exceeded the previous records set in 2014.

“A unique combination of economic forces including net farm income, expected income growth, crop and livestock prices, interest rates, exports, inflation, alternative investments, U.S. policy, and farmers’ liquidity, all played a major factor in the price increase we’re experiencing,” said Todd H. Kuethe, Purdue associate professor and Schrader Endowed Chair in Farmland Economics and survey author.

According to Kuethe, that’s rare.

“Normally we’ll see positive price pressure from one or two market forces; however, this June, survey respondents indicated that all ten forces we asked them about were putting upward pressure on land values.”

Inside the issue:

Indiana Farmland Prices Hit New Record High in 2021
2021 Indiana Pastureland, Hay Ground, & On-Farm Grain Storage Rent
Trends in Farmland Price to Rent Ratios in Indiana
Indiana Farmland Transactions, 2016 – 2021
Indiana Farmland vs. Alternative Investments

The August 2021 issue of the Purdue Agricultural Economics Report was edited by Todd H. Kuethe, Associate Professor and Schrader Endowed Chair in Farmland Economics. Read the full issue at https:purdue.ag/paer.

Additional insight:

For more in-depth analysis on the survey, the Purdue Center for Commercial Agriculture will host a free webinar Friday, August 20, 2021 from 12:30 - 1:30 P.M. EDT. Join Purdue agricultural economists Todd Kuethe, James Mintert and Michael Langemeier as they break down the Purdue Farmland Values Survey and USDA Land Values report, discuss marketing strategies for 2021 corn and soybean crops, and make projections for 2022 corn and soybean returns. Register for free today!

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