You likely won’t be surprised to know that a Purdue University annual survey completed in June showed Indiana land values up from the same period in 2020. However, you might be surprised at the size of the increase. Land prices for top-quality farmland jumped 14.1%, reaching an average of $9,785 per acre. That’s an all-time high. Average and poor-quality land were up 12.5% and 12.1%, respectively, at $8,144 and $6,441 per acre. Prices in all three land classes exceeded previous records set in 2014.

Todd H. Kuethe, a Purdue ag economics associate professor, conducted the survey. He notes that a unique combination of 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 role in moving prices higher. It’s rare to see all 10 factors asked about in the survey reported to be pushing land prices higher.

Statewide cash rents from 2020 to 2021 were also up, but not at nearly the rate of increase as land. Michael Langemeier, a Purdue Extension ag economist, has noted often that cash rental rate increases or decreases tend to lag land price trends.

Average cash rent was up 3% for top-quality land, from $259 to $269 per acre. Rates for average and poor-quality land were both up 4.6%, with average 2021 rates at $227 and $183 per acre, respectively. Learn more about the survey at ag.purdue.edu/commercialag.

Information supplied by Purdue Ag Communication contributed to this story.