Despite a tough year for commodity prices, farmland values across the country have remained steady, thanks in part to investor demand.
Farmers National Company reports that the cash price many farmers are receiving for their crops is currently lower than what it costs to grow them. That’s putting pressure on the ag economy, but so far it hasn’t translated into lower land prices.
According to Paul Shadegg, senior vice president of real estate for Farmers National Company, demand from both individual and institutional investors is helping prop up the farmland market. These buyers, often armed with cash, are purchasing land as a long-term investment even as farmers themselves face shrinking profit margins.