S.D. agricultural land values increase moderately in 2014
According to results from a farm real estate survey conducted by agricultural economists at South Dakota State University, South Dakota non-irrigated agricultural land values increased marginally in 2014.
"This percentage increase was smaller than increases reported from each of the past three years," said Kim Dillivan, SDSU Extension Crops Business Management Field Specialist.
The survey showed that the non-irrigated agricultural land average value was $2,470 per-acre; an increase of $142 per-acre or 6.1 percent from last year.
Dillivan shared an example of land which experienced an annual value increase of 33.6 in 2013, 26.8 in 2012 and 16.5 percent in 2011. "The percentage increase in values for 2014 was similar to the 5.2 percent increase reported in 2010," Dillivan said, pointing to Figure 1, which showed South Dakota non-irrigated agricultural land average values for 2009-2014.
Regional average values by land use are simple average (mean) values of useable survey responses. In each region, per-acre average values of non-irrigated land are highest for cropland followed by per-acre values of hay land, tame pasture, and rangeland. For each land use, Dillivan explained that per-acre values are highest in the east-central and southeast regions and lowest in the southwest and northwest regions.
"These regional patterns in land values have largely remained consistent over time and are closely related to climate patterns, soil productivity difference, and crop/forage yield differences across the state," Dillivan said.
Dillivan explained that regional agricultural land values are weighted by the proportion of acres in each agricultural land use.
"Cropland is the major land use in the three eastern regions (southeast, east-central, and northeast) and its per-acre average value is more than twice the value of rangeland in these regions," Dillivan said. "Thus cropland values largely determine the agricultural land average values in eastern regions of South Dakota."
However, the two western regions of South Dakota with the lowest average land values are mostly rangeland and pasture.
The 2014 estimates for land values and cash rental rates are based on survey data supplied in February and March by agricultural lenders, Farm Service Agency officials, rural appraisers, assessors, realtors, professional farm managers, and SDSU Extension field specialists. Land values and cash rental rates are reported only for privately owned land and should not be considered as estimated values for tribal, federal, or state owned lands.
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