USDA is projecting net farm income will drop to $73.6 billion this year, down 32-pecent from 2014. It’s the result of a $12.9 billion decrease in crop receipts and a $19.4 billion drop in livestock receipts. This will continue to apply pressure on the land market according to Iowa State University Professor Emeritus Dr. Mike Duffy. He says every 1-percent drop in income results in a ½-percent drop in land values. And so this fall’s harvest is one he is watching closely.

The 2015 farm income projection is also down 53-percent from the record high of $124 billion in 2013. And Duffy says that coincides with the peak in land values in Iowa set that same year.

Duffy says the expected increase in interest rates by the Fed in September will also have a negative impact on land prices and rental values. However, he still believes land is a good investment.