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2014 Outlook for Farmland Values & Cash Rent PowerPoint Presentation
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2014 Outlook for Farmland Values & Cash Rent

2014 Outlook for Farmland Values & Cash Rent

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2014 Outlook for Farmland Values & Cash Rent

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  1. 2014 Outlook for Farmland Values & Cash Rent

  2. 2013 Purdue Land Value SurveyState-wide
  3. 2013 Purdue Land Value SurveyState-Wide Cash Rent
  4. Value of Indiana Farm Real Estate, 1913- 2013, USDA
  5. Percentage Change in Nominal Indiana Real Estate Values 1911-2013, USDA
  6. Frequency of Change in Farmland Value
  7. Trend in Value of Indiana Farm Real Estate1910 – 2013
  8. Indiana Cash Rent, 1967- 2013, USDA
  9. %Change in Real Estate Value + Cash rent / Value, 1967 – 2013, USDA
  10. Farmland Drivers
  11. Long-term Interest Rates
  12. Estimated ReturnsAugust 13, 2013
  13. 2014 Cash rents will be pretty much unchanged Tenants will be cautious because of tightened margins Landowners will be happy with a rent that is more than they ever thought they would get Tight margins and tight cash flows will dampen farmers farmland buying Land values will slow their increase But we could find ourselves in an a 2009 like event and see downward adjust in farmland
  14. The Future Not To Long From Now 2014 was the first of a series of good crop years Corn and soybean demand grows but slowly The investments in production capacity made around the world provide even more corn and soybeans Long-term interest rates rise but stay in a 4% - 6% range After dipping below $4.00, corn prices settle in at a new plateau around $4.50 and beans at $10.70. The return to land is $196 per acre. After a period of adjustment the return to land grows at close to 2%
  15. Future After a turbulent period of adjustment, farmland values have Stabilized at $6,500 (a decline of 15%) and resumed their steady upward rise because we need to feed 9 billion people and everyone knows they aren’t making any more of it.
  16. Questions, Comments