Good farmland in Michigan remained relatively stable, according to a report done by GreenStone Farm Credit Services, which compiles market and customer data to determine annual benchmark land values.
“The Saginaw Valley area saw the largest decrease at 5.9% over 2018, with 80-acre parcels valued at an average of $480,000,” says Joe Hickey, vice president and chief appraiser with GreenStone. “Cropland in this area tends to be the most volatile due to the influence of sugarbeet production, which we have seen range between $8,000 to $13,000 an acre over the past several years.”
The amount of ground that remained unplanted this season influenced this year’s report, GreenStone says. Between acres left idle and late planting, overall productivity and profitability were unknown when the data was collected in June.
“The uneasiness of the crop year undoubtedly played into the buying activity and prices through the spring and summer," Hickey says. "The variation in monthly transactions and regional differences is why we use annual averages to establish our market benchmarks in each area."
The report is used in completing accurate and current appraisals based on regional sales data. The benchmarks illustrate trends in the marketplace that also can help farmers evaluate business options, according to GreenStone. Regions reflected in the report cover the state of Michigan and northeast Wisconsin.
Cropland in southern and southwest Michigan, the northern thumb and western northeast Wisconsin (NEWI) all showed no change in value over 2018. The areas of the southern thumb, the Saginaw Valley and southeast NEWI marked decreases of -2.5%, -5.9% and -3.8%, respectively.
The GreenStone analysis found dairy values for larger Michigan dairies remained unchanged at an average of $2,650 per stall and $6,000 per acre after a 5.5% decrease in 2018 over 2017.
Land used for recreation showed a slight increase of 2.8% over 2018 with an average price of $1,850 per acre in northern Michigan. Transition land, land between uses with the current use likely to change, in southeast Michigan posted an average of $8,100 per acre.
In central NEWI, the average price was $10,500 per acre. The large variance in value reflects the demand for nonfarmland in each region.
“We will continue to monitor land values and other assets as we work to bring the most fair and equitable assessment for our customers,” Hickey says. “As our customers continue to focus on what they do best — grow and sell crops — we will work to help them maximize their assets while remaining productive.”