News

Ag economy weighing on cash rents

The effects of the down ag economy are showing up in the land market. 

“Not so much optimism at the moment, to be honest.  I hate to be that way, but it’s challenging times.”

Nick Westgerdes, president-elect of the Illinois Society of Professional Farm Managers and Rural Appraisers, says that land values are holding steady, but…

“Resilient is the best way to describe them.”  He says, “We still see pretty strong sales out there in the countryside, but we’re starting to see some pretty severe pressure on rental rates.”

He tells Brownfield the relationship between a landowner and farmer can be tested in a downturn.

“We hear from our landowners quite a bit, things like, ‘My real estate taxes just went up. I understand that the farmer may be paying more for inputs, but my costs have gone up too.’”  He says, “So it’s a regular challenge.”

Westgerdes says cash rent continues to be the most popular form of rental agreement, however alternative leases like crop-sharing are seemingly gaining in popularity.

Brownfield spoke with Westgerdes at the annual meeting of the Illinois Society of Professional Farm Managers and Rural Appraisers In Springfield.

AUDIO: Nick Westgerdes – ISPFMRA