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Illinois farmland catches its breath

After a couple of roller coaster years of record land values, the market is leveling off.

Holly Spangler, Prairie Farmer Senior Editor

September 15, 2023

2 Min Read
A man standing behind a podium speaking into a microphone while another man leans on a stool behind him.
STEADY: Luke Worrell, Worrell Land Services in Jacksonville, Ill., along with University of Illinois ag economist Gary Schnitkey, present results of the midyear land values survey at the 2023 Farm Progress Show.Holly Spangler

After two years of 40% and 50% gains in farmland values, the Illinois land market has stabilized in 2023.

That’s according to the Midyear Snapshot Land Values Survey conducted by the Illinois Society of Professional Farm Managers and Rural Appraisers, in conjunction with Gary Schnitkey, University of Illinois ag economist.

“The market appears to be catching its breath,” says Luke Worrell of Worrell Land Services, Jacksonville, Ill., and chair of the ISPFMRA report.

In the first half of 2023, Class A and Class B farmland values have held steady, with little to no change in the “cream of the crop” land. Subsequently, there’s only been a 1% to 2% decline in marginal Class C and Class D land.

“From a values perspective, not much has changed since the calendar rolled into 2023,” Worrell adds.

Of those responding to the survey, 44% expect prices to remain the same for the rest of the year, while 36% expect prices to drop 1% to 3%.

Land is not in a decline or a drawback yet, but Worrell says they’ll keep an eye out for that in the second half of the year. A full 53% of respondents expect land values to drop over the next two years, while 38% expect them to remain static.

The ISPFMRA survey asks professional farmland managers to report on trends and land sales in their regions, and results of the midyear survey are announced each year during the Farm Progress Show. Here are more details:

Interest rates. About 63% of survey respondents expect interest rates to continue climbing, from 0.25 to more than 1 points. One-third expect stable interest rates.

Sellers. Not surprisingly, Worrell says, two-thirds of all farmland sales are coming from settled estates.

Cash rents. Most farm managers expect 2024 cash rents to remain the same or decline from 2023 levels. They expect excellent farmland to decline by $7 per acre, good and average farmland to decline by $5, and fair quality land to decline by $3.

Average cash rent? Worrell says the average cash rent on average farmland in Illinois is $300 per acre.

Leases. According to the survey, 27% of all leases are share rent leases, 9% are modified share rent leases, 25% are cash rent leases, 32% are variable cash rent leases, and 6% are custom farming.

Energy leases. A total of 34% of farm managers have a lease arrangement with a wind company; 31% have an agreement with a solar company. Worrell calls that a “slow burn” and expects it to gradually increase.

About the Author(s)

Holly Spangler

Prairie Farmer Senior Editor, Farm Progress

Holly Spangler has covered Illinois agriculture for more than two decades, bringing meaningful production agriculture experience to the magazine’s coverage. She currently serves as editor of Prairie Farmer magazine and Executive Editor for Farm Progress, managing editorial staff at six magazines throughout the eastern Corn Belt. She began her career with Prairie Farmer just before graduating from the University of Illinois in agricultural communications.

An award-winning writer and photographer, Holly is past president of the American Agricultural Editors Association. In 2015, she became only the 10th U.S. agricultural journalist to earn the Writer of Merit designation and is a five-time winner of the top writing award for editorial opinion in U.S. agriculture. She was named an AAEA Master Writer in 2005. In 2011, Holly was one of 10 recipients worldwide to receive the IFAJ-Alltech Young Leaders in Ag Journalism award. She currently serves on the Illinois Fairgrounds Foundation, the U of I Agricultural Communications Advisory committee, and is an advisory board member for the U of I College of ACES Research Station at Monmouth. Her work in agricultural media has been recognized by the Illinois Soybean Association, Illinois Corn, Illinois Council on Agricultural Education and MidAmerica Croplife Association.

Holly and her husband, John, farm in western Illinois where they raise corn, soybeans and beef cattle on 2,500 acres. Their operation includes 125 head of commercial cows in a cow/calf operation. The family farm includes John’s parents and their three children.

Holly frequently speaks to a variety of groups and organizations, sharing the heart, soul and science of agriculture. She and her husband are active in state and local farm organizations. They serve with their local 4-H and FFA programs, their school district, and are active in their church's youth and music ministries.

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