Ag Land Market Perspectives

Transcription

1 Ag Land Market Perspectives Damona Doye Regents Professor and Rainbolt Chair in Agricultural Finance Roger Sahs Assistant Extension Specialist Agricultural Land Value Topics Small parcel premium Changes in land values Land values relative to rents and income Land ownership Anticipated land disposal Random unrelated note 1

2 Agricultural Land and the Small Parcel Size Premium Puzzle Brorsen, Doye and Neal. Land Economics, Vol. 91, Number 3. August % USDA Yearly Percent Change in Land Values January, % 4.5% 3.5% 2.5% 1.5%.5%.5% 2

3 Cropland Value, 215 (% change) 2.7% 4.% 5.4% N/A N/C 5.3% 1.2% 1.% 3.8%.7% 4.4% 2.5% 8.7% 5.7% 1.1% 2.1% 6.3% 3.5%.6% 2.2% 4.8% 8.% 3.5% 2.1% 1.9% 2.6% 2.8% 1.%.4% 2.4% 3.8%.9% <1 9.5% 5.% 1 9 >1 USDA NASS data Pasture Value, 215 (% change) 1.2% 4.8% 2.5% N/A N/C <1 1 9 >1 1.6% 4.1% 5.6% 13.3% 18.8% 14.% 16.3% 7.2% 7.5% 1.7% 3.3% 4.4% 1.3% 6.9% 5.4% 1.9% 3.1% 4.4% 2.2% 2.9% 1.3% 1.4% 1.4% 1.9% 1.9% 1.3% 3.6% USDA NASS data 3

4 $/acre 4,5 4, 3,5 3, 2,5 2, 1,5 1, 5 US and OK Land Values US Pasture Land Value US Cropland Value OK Pasture Land Value OK Non irrig Cropland Value USDA-NASS Land Value ($/ac) Oklahoma Non Irrigated Cropland Cash Rents and Land Prices 1,8 35 1,6 3 1,4 1,2 25 1, Cash Rent ($/ac) Land Value Cash Rent USDA/NASS 4

5 Land Value ($/ac) 1,6 1,4 1,2 1, Oklahoma Pasture Cash Rents and Land Prices Land Value Year USDA/NASS Cash Rent Cash Rent ($/ac) Rent to Value US and OK Cropland and Pasture Rent to Value Ratios US Cropland Rent to Value OK Non Irrig Cropland Rent to Value US Pasture Rent to Value OK Pasture Rent to Value USDA/NASS 5

6 Income, $B $5. $45. $4. $35. $3. $25. $2. $15. $1. $5. $. U.S. Value of Agricultural Production, Net Farm Income and Agricultural Land Values F Value of sector production, $ B NFI, $B Land values, $/ac $3,5 $3, $2,5 $2, $1,5 $1, $5 $ Land values, $/ac 12 1 Oklahoma Net Farm Income, Value of Ag Production, and Farm Real Estate Value 1,8 1,5 Billions ($) , $ per Acre Net Farm Income Ag Production Value Farm Real Estate 6

7 Years to Pay for an Acre of Land with Gross Revenue from 3 Bushel Yield per Acre OK Agricultural Land, Means Acquired Percent of Acres 34% 49% Purchased from nonrelative, direct sale or broker Purchased from relative, direct sale or broker Purchased in auction 6% 11% Via inheritance or gift Source: USDA/NASS TOTAL Survey 7

8 OK Landlord Arrangements 1% 27% 17% 33% Operator landlord Non op LL: Individual Non op LL: Partnership Non op LL: Family corp Non op LL: Trusts 13% Operator LL: 2.3 million acres $3.7 billion value Non operator LL: 11.6 million acres $29 billion value Source: USDA/NASS TOTAL Survey 8

9 OK Agricultural Land Use, Acres Rented Out 3% 49% 48% Pasture Cropland Other, including forest Source: USDA/NASS TOTAL Survey OK Non operating Landlords Number of Tenants tenant 2 tenants 3 or more tenants Source: USDA/NASS TOTAL Survey 9

10 OK Agricultural Land Area Rented Out by Non operating Landlords to 99 acres 1 to 199 acres Percent of Land 34 2 to 499 acres to 999 acres 1+ acres Source: USDA/NASS TOTAL Survey Do you anticipate transferring ownership of any owned land in the next 5 years? Acres ( and %) 2,478,337 (4%) 2,219,8 (36%) Put or keep in a will Sell to a non relative Gift or sell to a relative Put or keep in a trust *[VALUE] (11%) 797,337 (13%) *Unpublished, but derived from subtracting published categories. 1

11 Do you anticipate transferring ownership of any owned land in the next 5 years? Percent of OK Agricultural Land (34,3, acres) 2% 7% 2% 6% Sell to a non relative Put or keep in a trust Sell to a relative or gift Put or keep in a will Unknown 83% Kansas Farm Management Association Data $18, $16, $14, $12, $1, $8, $6, $4, $2, $ Non Farm Income Net Farm Income Total Family Living 11

12 Resources and Contact Info OSU Agricultural Economics Department Kansas City Federal Reserve Bank Chicago Federal Reserve Bank USDA NASS USDA Census of Agriculture Facebook: OSU Farm Management 12