The average value of an acre of Nebraska farmland rose 16% in 2021, according to preliminary results from the annual Farm Real Estate Market Survey conducted by the University of Nebraska-Lincoln.
The survey pegs the value of an average acre of Nebraska farmland at $3,360 at the start of 2022. The result marks the third consecutive gain in values, following the low posted two years earlier in 2018. On a non-inflation-adjusted basis, the 2021 statewide value surpasses the previous high of $3,315 an acre posted in 2014.
Ag economists Jim Jensen and Jeff Stokes, who conduct the annual survey, note land industry professionals responding to the survey report the rise in Nebraska agricultural land values was attributed to higher commodity prices, interest rates near historic lows, hedging against inflation, and a renewed use in 1031 exchanges. The average value of an acre of Nebraska farmland rose 16% in 2021, according to preliminary results from the annual Farm Real Estate Market Survey conducted by the University of Nebraska-Lincoln.
Cropland posted the highest percentage increase for 2022 when compared to the prior year. The estimated market value of dryland cropland with irrigation potential rose by 19% across the state. Crop districts in the northeast, east, and southeast surged by about 18% to 24%. The other five districts averaged gains ranging from 7% to 15%. Dryland cropland without irrigation potential followed similar trends. The northwest, northeast, central, and east, report gains ranging from 15% to 21%, while the other regions improved from about 8% to 14%.
Center pivot irrigated cropland averaged 17% higher year over year, with the northwest, northeast, southwest, and southeast leading the state between 18% and 24%. The north and east reported gains of 14% and 15%, while the central and south rose between 12% to 13%.
Higher commodity prices also translated into gravity irrigated cropland averaging 16% higher in 2022, they report. The northeast and south gains were between 19% and 22% for this land class. Dry conditions across the state, along with higher commodity prices, contributed to continued strong demand for the irrigated land classes, they note.
Gains in the hayland and grazing land range from 10% to 13%. Potentially tillable grazing land once again led the three land classes at 13% as operators seek additional acres to develop with higher commodity prices. The major grazing and hayland districts — northwest, north, central, and southwest — report increases from about 10% to 15%.