Farmland Values Continue to Increase
By Kent Thiesse Farm management analyst kent.thiesse@minnstarbank.com
Farmland values in the Upper Midwest have continued to move higher early in 2023, surpassing the highest levels ever in many areas. Many locations in the Upper Midwest, except for portions of Western Minnesota and Iowa, South Dakota, Nebraska and Kansas, experienced average to above corn and soybean yields in 2022. These solid yields, combined with the highest crop prices in several years that existed throughout most of 2022, helped boost final 2022 farm income to some of the highest levels that we have seen in many years. The enhanced farm income levels have resulted in sharply higher land values in many portions of Iowa, Minnesota and other areas of the Upper Midwest. Land values have also been enhanced by very strong buyer interest in purchasing farmland and a limited amount of land being offered for sale in many areas.
Iowa State University does a comprehensive land value survey each December, which is regarded as one of the best resources on trends in Midwest farmland sales. The Iowa State Land Value Survey is based on actual land sales in Iowa over a 12-month period, as well as from reports by agricultural professionals that are knowledgeable regarding land market conditions, including
Alvin Fjell is installing booths in the H. F. Anderson restaurant. This makes a great improvement to Anderson’s ice cream parlor. There will be a greater demand for ice cream hereafter, by the young folks.
Mrs. C. O. Gustafson of St. Peter arrived here Thursday and will stay at the Anton Malmberg home for a while. With her came Curtis Malmberg who has been visiting with grandma Gustafson since Christmas.
Pete and Albert Peterson of Alfsborg have rented the Freeman Anderson farm in New Sweden. Decorator Fjell is painting John Peterson’s Ford.
The local W.C.T.U. will meet with Mrs. T. F. Bergquist next Tuesday afternoon, Feb. 17.
E. O. Abrahamson and family and Henry Abrahamson visited at the Rudell home at Winthrop Sunday. Miss Claudia Swenson of Minneapolis visited here over Sunday.
John Johnson of Parshall, N. D., was a visitor with his bro-in-law C. H. Nelson over Sunday.
75 Years Ago – Feb. 16, 1945
W. H. Krohn and family visited at the home of Mr. and Mrs. Gilbert Swartz in St. Paul, Sunday. Mrs. Justine Jacobson entertained a group of ladies at her home Saturday afternoon in observance of her birthday anniversary.
Mr. and Mrs. Arthur Nelson of Winthrop, Mrs. Theo. Ostrom and Grace, of New Sweden, visited Sunday afternoon at the Arthur Flygare home in Bernadotte.
Mr. and Mrs. Delphin Anderson and children, Duane and Gladys, were entertained at dinner Sunday at the Gerald Wise home in New Sweden. The afternoon was spent at the Orville Quist home near St. Peter.
Miss Elaine Isenberg, daughter of Mr. and Mrs. Delphin Isenberg of Cornish, has completed a course in beauty culture, and also passed the state board examinations, thereby receiving the license for such work.
Raymond Quandt, Hugo Albrecht and Arthur Schaeffler, members of the board of Lafayette township, went to St. Peter, Monday, and attended the annual weed conference, which was held in the court room of the court house.
Saturday and Sunday with their father, W. C. Milliman, in Bernadotte. They came here to observe Mr. Milliman’s birthday anniversary, which was on Saturday.
50 Years Ago – Feb. 19, 1970
Those who spent the weekend at the Ambassador Motel in Minneapolis as guests of Land O Lakes were Mr. and Mrs. Arnold Berdan, Mr. and Mrs. Sheldon Swenson, Mr. and Mrs. Richard Portner, Mr. and Mrs. Roger Isaacson and Mr. and Mrs. Leo Marti.
Lois Wellnitz of Princeton spent the weekend here with her parents, Mr. and Mrs. Kurt Wellnitz.
Those who gathered at the Gerald Forst home Sunday to honor Robert Hamann who is home on furlough, were, Mr. and Mrs. Earl Schroeder and family of New Ulm, Mr. and Mrs. Harold Meyer and boys, Mr. and Mrs. Delton Hamann and family, Mr. and Mrs. Greg Bieraugel and Mrs. Rose Hamann.
Mr. and Mrs. Clarence Maidl and family went to the airport in Minneapolis Wednesday to get their daughter, Diane and Deanna Schmitz, who returned that day from a five day visit at the Tony Cranford home at Metairie, La. They also attended the Mardi Gras at New Orleans while there.
Narve Nelson and Otis Muller returned Monday evening from a week’s fishing at Leech Lake with Mr. and Mrs. Harold Woods of Gibbon.
Forester members from this area who attended the C.O.F. Bowling Tournament at St. Peter Sunday were Gerald, Richard and Ronald Seitz, Alphonse Goblirsch, Jerome Weisensel, Leo Maidl, Marion Bushard and Clarence Maidl.
Mr. and Mrs. Michael Hatch of Rochester spent the weekend at the Otis Muller home.
Mr. and Mrs. Kenneth Eckberg visited at the Carl Lund home in St. Peter Friday evening.
NICOLLET LEADER
115 Years Ago – Feb. 18, 1905
The personal property taxes are due March 1st, and unless paid by that time a penalty of 10 percent will be added.
The fifth of its series of club dances was given by the Nicollet Dancing Club at Blank’s hall Tuesday evening. The Nicollet orchestra furnished the music.
Do not forget the special school meeting to be held on Saturday evening, February 25th. It is important that all interested in school matters should attend this meeting. The school rooms at present are so overcrowded that early provision needs to be made for an extra room and teacher for same.
The farmers of Brighton township will build a co-operative creamery near the place of Adam Jutz, on the southwest corner of section 3, and are busy hauling material for the same now. They will commence with the erection soon as the weather permits and will hold a meeting on Saturday, March 4th, for the purpose of organizing.
Except for telephonic communication, this village was cut off by the drifting snow and extreme cold weather.
100 Years Ago – Feb. 14, 1920
Mrs. Henry Netzke visited her daughter at New Ulm the first of the week who has been ill.
George and William Lange of Oshawa township have gone to Sioux City, Iowa, to attend an automobile school.
Show your loyalty to the fire company by purchasing tickets for their annual ball to be given in the Nicollet opera house tonight.
The ladies of the Progressive Banner will give an apron sale for the benefit of the auxiliary in the local auxiliary parlors Saturday afternoon, Feb. 21.
Henry Epper and family are getting comfortably settled in their new, large and modern residence on West Fourth Street, having moved in during the week. Three auctions are booked for this vicinity in the near future. The sale of Louis Wenholz will occur on February 20. August Schroeder will conduct a sale on February 27th, and H. C. Fricke will close out his personal property on March 4th.
Mr. and Mrs. Chas. Johnson of Langdon, N. D., the latter a sister of J. H. Meurer, arrived here last Friday for an extended visit with relatives in Nicollet and vicinity. Mr. Johnson was an old time resident of Nicollet and in his early days drove a stage between New Ulm and St. Peter.
Dr. E. F. Vogelpohl, Nicollet’s resident dentist, opened up for business in the former Dr. Meilicke’s office this week. His office is modernly equipped in every respect for his dental practice. Dr. Vogelpohl was called out of town today but will be on deck again Monday morning.
85 Years Ago – Feb. 16, 1935
About 7:30 Monday morning, the fire department was called to the farm home of Henry Ott where a bad chimney fire was raging. There was no damage.
Emil Starke has been busy for the past two weeks cutting logs and sawing lumber for a new barn which he will have erected on his farm this spring.
Mr. and Mrs. Leonard Wyngarden and children, who spent several months with Mr. and Mrs. Carl Netzke returned to their home at Tappen, N.D., Wednesday.
Mr. and Mrs. Elmer Kettner, Mrs. L. W. Kettner, Mrs. E. A. Zimmermann and Mrs. Aug. Thom, Jr. visited relatives at Truman on Monday. The latter two remained for a week’s stay.
Aug. Koetting of Courtland township was seriously injured, Wednesday morning, when a shed, which he was tearing down, suddenly collapsed, pinning him underneath. His right hip and his right leg were broken.
the Chester Nelson home Saturday evening.
LAFAYETTE NICOLLET LEDGER
25 Years Ago – Feb. 16, 1995
Congratulations to Peter Anthony, son of Willis and Rachel Anthony, for being named to the Dean’s List at Bethany College. Also to Michael Gunderson, son of Darwin and Brenda Gunderson, who also made the Dean’s List at the University of Minnesota, Morris.
Sharon Gaalswyk, Karen Gaalswyk, Cheryl Epper and Joyce, manager of the Budgetel Motel went to dinner at Charley’s and saw the play at the University in Mankato, “Stepping Out.”
Kevin and Jeanette Hewitt of Cleveland entertained Sunday afternoon in honor of their daughter, Heather’s 4th birthday. Among those present were Earl and Evie Nelson of Norseland, Bob and Donna Hewitt of St. Peter, Darren and Corrinne Ely, and Angie Seitzer of Cleveland.
Darryl and Barbara Stevensen and Mr. and Mrs. Wade Zieske of rural New Ulm flew to Florida last week to spend time with Barbara’s parents, Herb and Jolene.
Good winter weather has allowed all aspects of construction for the new InLaws Restaurant at Nicollet to proceed. The business, located at the corner of Highways 14 and 111 in Nicollet, is slated to open in early spring.
Herring Trucking of Lafayette put up a new building on the old railroad right-of-way property over the winter. It’s behind the city disposal plant. The 40 X 75 foot building has space for two trucks and will give the Herrings a place to wash their trailers when they return from trips. Final details are being completed and the building should be ready for use in a few weeks.
10 Years Ago – Feb. 18, 2010
Nicollet senior Jordan Rudenick surpassed the 1,000 point career mark in a make-up game with St. Clair Saturday afternoon. Rudenick, a four-year player for the Nicollet High School, has been a consistent scorer for the Raiders and is a good all-around player.
Congratulations to Steve and Barb Hulke of Courtland on becoming grandparents for the first time. Little Hannah Hulke was born to their son and daughter-in-law, Brent and Andria, February 7.
appraisers, farm managers, and ag lenders. The complete 2022 Iowa State Land Value Survey results can be found at: https://www.extension. iastate.edu/agdm/
(Note – Refer to the Table at the end of this column for a summary of Iowa land values from 2008-2022.)
The average value of Iowa farmland in 2022 was $11,411 per acre, surpassing the 2021 average of $9,751 per acre, which previously was the highest average land price ever recorded since the Iowa State Land Value Survey was initiated in 1941. Since the recent low point of $7,183 per acre in 2016, the Iowa State Land Value Survey has shown an increase of 59%, or $4,228 per acre, in the past six years (20162022). This includes a 51% increase in land values in a span of two years from December of 2020 until December of 2022.
The average land values in 2022 increased in all 99 counties in Iowa, as compared to 2021 average values.
Eight of the nine Iowa crop reporting districts had at least a 13% increase in land values in 2022, with Southeast Iowa being the exception with a 9.8% increase. The greatest increases were at just over 22% in both the northwest and southwest districts. The northwest district reported the highest 2022 average land value in Iowa with an average of $14,878 per acre, with the north central, west central, east central and central districts all averaging over
Mrs. Martha Carlson and Mrs. LeRoy Anderson spent last weekend in the twin cities.
Carl Youngblom of St. Paul and his roommate, Tom Kostuch, returned to St. Paul Monday evening, after a few days visit with the former’s parents, Mr. and Mrs. Clarence Youngblom.
Misses Betty and Bonnie Milliman, students of the Hamline University, Minneapolis, spent
A Judson correspondent says a party from Nicollet, who has been cutting ice, had the misfortune of journeying to the river bottom, rather a disagreeable experience, though the distance traveled was only twelve feet. He then drove home six miles, in his wet clothes, which were certainly stiff upon him by the time he arrived. Do you know him?
The blizzard we had Tuesday worked havoc with the train service. No trains went either way until the following morning when the snowplow cleared the tracks.
A social evening was spent at the home of Miss Norma and Gordon Ott Wednesday evening. The time was spent in playing “bunco” with high honors going to Miss Viola Bode and Harvey Enter and Miss Elvira Enter and Harold Heidemann, low. At midnight a delicious lunch was served.
Peter Jutz came down Monday from Pierz with a truck load of potatoes which he is selling very cheap.
Mrs. Martin Zins and daughters spent Thursday at Nicollet with her sister, Mrs. R. J. Dauffenbach.
Joyce and Allen Erickson, Henry Maritz, Margie Monson and Mrs. Ella Johnson were entertained at
The fourth annual Polar Plunge at Lake Hallett in St. Peter Sunday was even bigger and better than the first three. A total of 313 “human plungers” raised more than $44,000 for Special Olympics. Those numbers are up from 110, 165, and 196 plungers and $21,000, $28,500, and $30,000 in the first three. Nicollet County Sheriff Dave Lange and his group opened the plunge. Nicollet American Legion Post 510 was represented by Del Vulcan and Bruce Connelly. The gals went first and the guys followed when the Courtland Fire Department jumped. Group members were Pam Meyer, Mary Luepke, Jenna Krueger, Danielle Bode, Dave Ubel, Leon Luepke, Jon Rewitzer, Brandon Matter, Adam Marti, and Pat Stadick. Lafayette Ambulance “Team McFreezies” included Kim Schwab, Daryl Trautmiller, Kevin Reinhart, Jay Carlson, Jessi Gieseke, Collin Gieseke, and Marti Uhde. Andrew and Lisa Quist of Norseland were among nearly 90 Minnesota Farm Bureau members who attended the Minnesota Farm Bureau Federation Promotion and Education Conference January 29-30 in Bloomington.
Page 2 Sunday, March 26, 2023 Nicollet County Ledger Mail: P.O. Box 212, Lafayette, MN 56054 Office: PO BOX 212, Lafayette, MN 56054 HOurs: Call ahead for hours. PHOne: 507-246-6248 eMail: info@nicolletcountyledger.com Website: nicolletcountyledger.com robert lawson, Publisher and Managing editor facebook.com/ nicolletcountyledger Simon and Sons Pvt. Ltd. Layout & Design 1 YEAR PRINT EDITION: In Minnesota ... $45.00 Out-of-State ... $50.00 Nicollet County subscribe: subscriptions are non-refundable. DeaDline: noon Monday for advertising, news, photos and new subscriptions or subscription changes. ONLINE EDITION: Digital Subscriptions Available on the Ledger Website NAME Send this form and check to P.O. Box 212, Lafayette MN 56054 or go to nicolletcountyledger.com to use a debit or credit card. NicolletCountyLedger.com or issuu.com/nicollet-county-ledger ADDRESS CITY/STATE/ZIP CODE Ledger Nicollet County Ledger (usPs 301420) published weekly by the South Central News & Media LLC . PO BOX 212, Lafayette, MN 56054 Periodicals postage paid at Lafayette, MN and additional mailing offices. Postmaster: Send address changes to PO Box 212, Lafayette, MN 56054. Serving Nicollet County Since 1904 See FOCUS ON AG, page 3 Support Your Local Newspaper Send Story Ideas/Tips to the Nicollet County Ledger info@nicolletcountyledger.com 507-246-6248
news From the Archives Ad From the PAst
Father Craig Timmerman
You are beloved! A Blessed Holy Week to you all! This is the week we are renewed in our faith. During Lent the ‘old man’ in some way dies. This week we receive a new life, we become new. Deeper faith, hope and charity. Living more deeply in communion, friendship, relationship with Jesus, the Father, the Holy Spirit, Mary and the saints and angels. Jesus draws close to us in our sins and sufferings. We are not alone, but He is with us. This really does make all the difference! So this week - stay with Jesus! Let Holy Week be just that: holy. Put God before everything
AsK A troPPer
By Sgt. Troy Christianson Minnesota State Patrol
Question: What am I supposed to do if I am at a railroad crossing and need to report an emergency?
Answer: Call 911 and provide the needed information. Every highway-rail crossing has an Emergency Notification System (ENS) sign that provides a 24/7/365 telephone number to report problems or emergencies at the railroad location. The blue colored ENS sign is located on the railroad crossing posts or the metal control box near the tracks. The ENS is for emergencies that would require stopping train traffic due to an obstruction or any other
problem at the crossing. By providing the DOT number on the sign, the dispatchers know exactly where the grade crossing is and can notify trains moving in that direction to either come to a stop or be placed on a speed restriction.
You can avoid a ticket — and a crash — if you simply buckle up, drive at safe speeds, pay attention and always drive sober. Help us drive Minnesota Toward Zero Deaths.
If you have any questions concerning traffic related laws or issues in Minnesota send your questions to Sgt. Troy Christianson –Minnesota State Patrol at 2900 48th Street NW, Rochester MN 559015848. (Or reach him at, Troy. Christianson@state.mn.us)
info@nicolletcountyledger.com
else this week. Other things are secondary, even completely unimportant compared to what we are doing this week. Stay with Jesus, not just on Sunday, but through the week. Of course the most important thing this week is to come to the services on Holy Thursday, Good Friday, waiting on Holy Saturday, and then Easter Vigil/Sunday! We aren’t just ‘going to Church’. We are participating in the events of our own salvation. Our salvation is renewed and deepened. We draw even closer to Christ at the Last Supper, at His death and burial, and in the new life of His Resurrection, which is also our resurrection! Let Jesus draw you
diocese oF new ulm
to trust the Father as He did, to the end. Let Him transform your heart to love to the end as He did.
Be with Mary, not leaving His side even at the cross. This is our life, and it will renew you. Give God this time. We also can structure our whole lives this week around Holy Week. Not only by coming to daily Mass or taking an hour or even a few minutes to stop in the chapel/Church to pray. But our faith life really takes shape when we even structure our homes after God. This week, be with Jesus every day. Fast extra this week, to stay with Him. Save anything sweet, or alcohol and pop for Easter. Pray a little more, even than
you did in Lent. Decorate your house according to Holy Week - put holy images, crucifix, etc. in central places of your house to remind you. And then, treat your house like we do in Church. After Holy Thursday, we strip our Church of everything. Do this in your house - take down your pictures, crucifixes, etc. Take off the tablecloth or other decorations. Let your house speak, ‘Jesus has died’. Keep it that way all day Saturday, as Jesus is in the tomb. No celebrating Easter until Jesus has risen! And then, when you attend Mass for the Resurrection, it will be a true celebration and return to life again, even in your house! You are beloved!
Centuries-old penitential devotion, Stations of the Cross to be led by Bishop Chad W. Zielinski on Good Friday
NEW ULM – On Good Friday, April 7 (weather permitting), at 3 p.m. at the Way of the Cross shrine in New Ulm, the Most Rev. Chad W. Zielinski, bishop of the Catholic Diocese of New Ulm, will lead a public prayer and meditation on the fourteen Stations of the Cross walking along the shrine’s historic pathway marked by lifelike images portrayed in statuary that retell the story of Christ’s trial, crucifixion, and death. The Way of the Cross will be staffed by the Knights of
Columbus from 1:00 to 5:00 p.m. Good Friday afternoon.
People of all faiths are invited to attend.
The Way of the Cross, a 119year-old shrine of the Diocese of New Ulm, was inspired by Father Alexander Berghold. The shrine’s fourteen stations, grotto, and Lady of Sorrows Chapel were created and completed in 1904 by Sister Flavia and the Sisters of the Order of the Poor Hand Maids of Jesus Christ. The seasonal shrine
maintenance and fundraising for restoration efforts is a joint project of the local Knights of Columbus Council 1076 and the Diocese of New Ulm Way of the Cross Committee. Throughout the years, restoration has depended on voluntary contributions from individuals and organizations from across Minnesota and beyond. In 2020, the shrine was placed on the National Register of Historic Places by the United States Department of the Interior.
Way of the Cross to be featured on WCCO Television.
On Wednesday, April 5, the Way of the Cross shrine will be featured in a special “Finding Minnesota” segment to be broadcast on WCCO Television (Ch. 4) during the 10 p.m. news. The segment will air again on Thursday morning at 4:30 a.m. and repeat on Easter Sunday around 10:30 p.m. on WCCO. It will also be available to view on WCCO.com (CBS Minnesota).
Light For The Way Pastor’s Column: Who’s Lost?
By Pastor Wayne Wayne Bernau Immanuel Lutheran
Have you ever gotten lost? I recall a couple times in my life when I was out hunting in areas not too familiar to me. Once in the midst of a woods and once in the middle of a swamp, I began to wonder and worry if I would find my way back before the sun set and darkness descended on the land. To be lost in the dark—now that is not a good thought! Fortunately, in both cases, I was able to find my way back to safe, familiar territory. Thank You, Lord!
Luke 15 is the “Lost and Found” chapter of the Bible. Jesus
$12,000 per acre.
Trends in farmland values in Southern Minnesota have been tracking very closely to the trends shown in the Iowa land value survey for northern crop reporting districts in Iowa. Similar to many areas of Iowa, land values were much higher in 2022 in most portions of Southern Minnesota due to the much higher commodity prices and average to above average crop yields in many areas. There have been many land sales across Southern Minnesota that have topped $10,000 per acre in the past 12 months, with some isolated sales nearing $15,000 per acre. Even with the higher land values, there has continued to be a gap between the average land price for high quality, welldrained farmland compared to lower quality land that is poorly drained. The number of potential buyers interested in purchasing farmland has also increased in many areas of Minnesota.
Based on the recent Iowa State Land Value Survey, farmers accounted for approximately 72% of the farmland purchases in Iowa in 2022, which was primarily existing farm operators that were expanding their owned land base. The remaining 28% of farmland was purchased by real estate investors, with about half being retired farmers and other local investors and the other half being non-local investors. The main reasons listed for the strength in farmland values were the continued high commodity prices and strong farm income levels in 2022, the limited supply of land offered for sale and the continued low interest rates in the first half of 2022. The survey indicated that there continues to be strong interest for purchasing land among farmers as we entered 2023. Data released in late 2022 by the Federal Reserve Districts across the U.S. showed similar trends in average land values in the Upper Midwest at the end of 2022, compared to a year earlier. The highest 12-month percentage increases at the end of 2022 were North Dakota at 30%,
shared three stories: the lost sheep, the lost coin, and the lost son. A shepherd searches for his lost sheep until he finds it. A woman searches for a lost coin until she finds it. And a father eagerly awaits the homecoming of his lost, wayward son, and then throws a party to celebrate his son’s safe return. Actually, if you know the parable of the lost son, you might realize that the father had not one, but two lost sons. The younger, prodigal son left home and was lost for a time as he wasted his inheritance. But he eventually returned home to his father. The older son stayed at home, but was in essence, “lost” to his father. For when the younger son who had been broken
by the hard knocks of life humbly returned home, the older, self-righteous son refused to join the homecoming celebration thrown by his joy-filled father. Spiritually speaking, have you been, or are you presently lost from God? Have you wandered away from the home of your Father God and wasted your life in godless living? Are you ignorant of, or have you forgotten God’s love, grace, and mercy? Have you strayed from His commands? Do you sense a real distance between you and the Lord? And do you sometimes refuse to celebrate with the family of God over another sinner who repents and returns? The Lord loves lost peo-
ple. Jesus stated His purpose for coming to earth in Luke 19:10: “For the Son of Man came to seek and to save the lost.”
If you are lost, know that the Father has not stopped loving you and longs eagerly for your return. If you are lost, know that Jesus wants you to be found. He comes looking for you. If you are lost, know that the Holy Spirit will patiently guide you back home to the Father’s family and house. And then, together with other lost sinners who have been found and saved by God’s amazing grace, the heavenly rejoicing can continue! After all, there’s no place like home! Especially after you have been gone for a season.
Indiana at 29%, Kansas at 27%, Minnesota at 24% and Iowa at 22%. Nebraska and Illinois were at a 20% increase. South Dakota, which was hard-hit by drought last summer, was still at a 13% increase in land values in 2022.
The U.S. Federal Reserve has increased the prime interest rate by 4.50% in the past 14 months, increasing the prime rate from 3.25% in early 2022 to 7.75% in early March of 2023. The Federal Reserve continues to discuss the likelihood of further increases in the prime interest rate during the balance of 2023. Prior to 2022, the prime rate interest rate had not changed in nearly three years, which provided a stable financing environment for buyers of farmland.
•
per year P & I payment
• 5.00% Interest Rate = $57,158 per year P & I payment
• 6.00% Interest Rate = $63,078 per year P & I payment
• 7.00% Interest Rate = $69,251 per year P & I payment
• 8.00% Interest Rate = $75,656 per year P & I payment
From early 2022 until March of 2023, that represents an increase in the estimated annual REM principal and interest payment of over $24,000 per year. On 160 acres of farmland, this
values to remain fairly steady in the next 12 months, while 28% forecast a decline in land values in Iowa by the end of 2023. When asked about farmland trends over the next five years, 60% of the respondents expect land values to increase by 10-20%, while 24% feel that future land values will decline in the next few years.
Currently, most signs point toward continued strength and even potential further modest increases in land values in the next 12 months. However, there are some lingering “caution flags” that could potentially reverse this optimistic trend and revert to more downward pressure on land values. These potential challenges include:
• Return to lower crop prices and lower profitability in crop and livestock farming.
• Further increases in longterm interest rates by the Federal Reserve Bank in the next year.
• Changes in federal policies, such as estate taxes, capital gains taxes or 1031-exchange policies.
• Reduced interest to purchase farmland or a large increase in the amount of land being offered for sale.
• Lack of confidence in the land market by farmers, investors and ag lenders.
Following is an example to show the impact of the rapid rise in long-term interest rates.
Assume that a land buyer pur chased an 160-acre parcel of farmland and financed $5,000 per acre ($800,000 total) with a 25-year amortized real estate mortgage (REM). Following are the estimated increase in annual principal and interest (P & I) payments as the long-term interest rates have increased:
would add over $150 per acre to the annual cost of the land.
As part of the 2022 Iowa State Land Value Survey, the respondents were asked their opinion regarding the future direction of farmland values. Fortyeight percent of the respondents expect Iowa farmland values to increase by 5-10% by the end of 2023, as compared to the end of 2022. Twenty-four percent of respondents expect farmland
As we enter a period of increased crop input costs and tighter margins in crop and livestock production, farm operators need to be more cautious on over-extending their farm business to purchase land. This is especially the case for beginning farmers and those borrowing a significant amount of money that will be impacted by the increasing long-term interest rates. It is best to sit down with a good farm business financial advisor or ag lender to analyze the potential financial impacts on the farm business before finalizing the farm purchase decision.
Nicollet County Ledger Sunday, March 26, 2023 Page 3
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a table showing the average value of Iowa farmland for the past 15 years (2007-2021), as well as the percentage change in land values from year-to-year:
Following is
YEAR AVE. VALUE PER ACRE % CHANGE 2008 $ 4,468 +14.3 % 2009 $ 4,371 (2.2 %) 2010 $ 5,064 +15.9 % 2011 $ 6,708 +32.5 % 2012 $ 8,296 +23.7 % 2013 $ 8,716 +5.1 % 2014 $ 7,943 (8.9 %) 2015 $ 7,633 (3.9 %) 2016 $ 7,183 (5.9 %) 2017 $ 7,326 +2.0 % 2018 $ 7,264 (0.8 %) 2019 $ 7,432 +2.3% 2020 $ 7,559 +1.7% 2021 $ 9,751 +29.0% 2022 $11,411 +17.0% NOTE – This data is from the 2022 Iowa State University Land Value Survey. Focus on Ag Continued From Page Two Display Ad Network program by running the classified section of your newspaHowever, the decision is ultimately up to slightly in size to fit your column sizes. call MNA at 800/279-2979. Thank you. Display Ad Network week beginning 3/19/2023 South MDAN ads to run ONE TIME, the week beginning 3/19/2023 South REQUEST A FREE QUOTE CALL NOW BEFORE THE NEXT POWER OUTAGE (855) 984-8982 Prepare for power outages today WITH A HOME STANDBY GENERATOR $0 MONEY DOWN + LOW MONTHLY PAYMENT OPTIONS Contact a Generac dealer for full terms and conditions *To qualify, consumers must request a quote, purchase, install and activate the generator with a participating dealer. Call for a full list of terms and conditions. FREE 7-Year Extended Warranty* – A $695 Value!
IOWA AVERAGE FARM LAND VALUES (2008-2022)
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Metro MISCELLANEOUS
STATEWIDE Central South North