Farmland Prices Not Affected by Drought
Despite drought conditions, farmland prices in South Dakota are increasing. Between early 2011 and this year, cropland prices showed a 29 percent increase across the state. As SDPB’s Cassie Bartlett reports, the current economy and drought have caused people to invest in land.
Larry Janssen is an economics professor with South Dakota State University. He says some land in South Dakota has sold for 10 thousand dollars an acre this year. While the high prices take first time farm buyers out of the picture, Janssen says established farmers have taken advantage of current conditions.
“Continues to be purchased by farmers expanding their operations. If that’s the case, then they’re making the decisions based on taking into account what they think is the future for land prices and values, and so forth, and the production capabilities. Interest rates are exceedingly low, compared to past, so those are factors that causes a lot of people to consider purchasing land that may not have otherwise paid as much,” Janssen says.
Janssen says the economy also caused some people to move investments into farmland real estate and it’s been more positives than negatives so far. For South Dakota Public Broadcasting, I’m Cassie Bartlett.