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Ag Land Values

Written by Dennis Sun

As ranchers and farmers, we all realize the importance of ag land values. It’s basically what our businesses are all about. Ask any county commissioner about land values, and their eyes will get bigger than sewer lids. Counties depend on land values, as do ag bankers.

Here in Wyoming, it seems that our land values have stabilized, but our taxes keep going up. I guess we’re all paying for buildings on community colleges or other bond issues, but it does seem that our taxes are going up faster than ag land values.

Nationally, the ag land real estate value, a measurement of the value of all land and buildings on farms and ranches, averaged $3,010 per acre for 2016, down $10 per acre, or 0.3 percent, from 2015 values. Regional changes in the average value of farm and ranch real estate ranged from a 3.3 percent increase in the Pacific Region to 4.3 percent decrease in the Northern Plains Region. The highest farm real estate values were in the Corn Belt Region at $6,290 per acre, and the Mountain Region – that’s us – had the lowest ag lands value at $1,110 per acre. That includes both farm and ranch lands combined.

When the United States Department of Agriculture (USDA) does these surveys, they breakout the types of lands into either cropland – irrigated or non-irrigated, and grazing lands. So, when we see them combined, the dollar amount really doesn’t make much sense to us. I guess it does to a bureaucrat in Washington, D.C., but I’ll tell you, our bankers wouldn’t understand.

But it is interesting to look over the average ag land’s real estate values across the nation compared to our states in the Mountain Region. It is not a surprise to anyone that California is high at $7,900 per acre, with Iowa close behind at $7,850, but Rhode Island is the nation’s highest at $13,800, followed by New Jersey at $12,800 and Connecticut at $11,200 per acre. You can see in those small states with a large population, there isn’t much room for ag land. But in Wyoming, with its abundance of ag lands, the value comes out at $660 per acre, and that is why a large number of farm and ranch buyers are from out of state. New Mexico is lower than Wyoming at $520 per acre.

The average cropland value in Wyoming is $1,370, Montana is $1,010, Colorado is $1,910 and New Mexico is $1,450 versus California at $10,910, Iowa at $8,000 and New Jersey at $13,000 per acre. In Wyoming, irrigated cropland averaged $2,200, which is about the same for the last five years. Non-irrigated cropland value in Wyoming averaged $770, down a little bit from 2014.

For the average of pasture land, Wyoming was $510 an acre in 2016, where Idaho, the highest in the Rocky Mountain Region, was $13,000. I don’t understand that. We both have about the same percentage of public lands. I guess they have more creeks and trees.

The value of ag lands and buildings, which is derived by multiplying average value per acre of ag real estate by the land in farms and ranches, in Wyoming was $20,064 in 2016, compared to Montana with $53,133. So, you can see Montana has more celebrities and movie stars with big houses on ranches than Wyoming does. We’ll let them keep that honor.

Well, this is probably more than you wanted to know, but it is interesting.