One year after skyrocketing 29 percent, the average value of an acre of Iowa farmland jumped another 17 percent or $1,660 to $11,411 per acre.  The nominal value of an acre of farmland is again higher this year than at any point since Iowa State University began surveying values in 1941.  When adjusting for inflation, the 2022 average value surpasses the previous inflation-adjusted record value set in 2013 for the first time.  Farmland values in Iowa have increased more than 15 percent in a year a handful of times since 1941, most notably in 2011, when values rose32.5 percent, and last year, when values rose 29 percent.  While inflation was a major factor that drove the increase last year, Wendong Zhang, associate professor of economics and faculty affiliate of Center for Agricultural and Rural Development at Iowa State University, said that it did not play as much of a factor as commodity prices, limite land supply, and low interest rates through summer 2022 did this year.  Zhang, who is responsible for conducting the annual survey, said that inflation rates this year are similar to those from last year, but the Federal Reserve has used aggressive rate hikes since this summer to curb the problem.  For the first time, this year’s survey asked respondents’ views of current farmland values.  Zhang said that 70 percent of the respondents feel that current land values are too high or way too high.  For the second year in a row, all 99 Iowa counties showed an increase in land values.  However, for the first time in almost a decade, Scott County, located in east central Iowa did not report the highest overall value.  O’Brien County, located in northwest Iowa, topped the list this year, reporting a 20.6 percent increase, or $2,818 per acre to an average of $16,531.  Decatur County again reported the lowest value, though land values there increased 10 percent, while Decatur County saw the smallest dollar increase, $505 per acre.  Land values increased across all crop reporting districts.  The northwest district reported the highest overall value at $14,878 per acre, the largest percentage increase at 22.3 percent, and the largest dollar increase at $2,714 per acre.  Retired agriculture economist, Mike Duffy, who previously was responsible for the annual land value survey produced by Iowa State University believes people may be prompted to sell some of their land because of the high prices.

High quality land in the West Central, Southwest, and Northwest districts all saw increases of more than 20 percent – 20.6%, 21.2%, and 22.3% respectively.  The Northwest district reported the largest dollar increase in high quality land at $3,124 per acre.  The Southeast district reported the smallest percent change in high quality land at 10.3 % and the smallest dollar increase at $1,201 per acre.