Sitting at a table waiting to speak at the Jay County Soil and Water Conservation District annul meeting a couple weeks ago, it didn't take long for my host to start quizzing me about land prices. It seems a sizable tract of land was about to sell in the area, and people were speculating how much it might bring.
Reports from people, who do real estate sales for a living, such as Halderman Farm management, Wabash, indicate that farmers braved a blizzard on two consecutive days in early February to pay strong prices for farmland in north-central Indiana. Reports of high-dollar land are out there—how many are true may be another story. What is true is that land with some limitations, such as drought or poor drainage, that would have brought $1,000 to $1,500 per acre in the mid-80s now routinely fetches $5,000 or more per acre. And good ground brings even more.
It doesn't appear that farmers are backing of buying land. Most of the high dollar sales have either been by neighbors who wanted to buy an adjoining piece, or by farmers who lined up investors to buy land they farmed so they could keep farming it.
That's one sign that the ag economy is still trucking along at a good clip. Another came in the form of huge crowds at the National Farm Machinery Show in Louisville. Walking a half mile from parking to the first building wasn't uncommon, even on Thursday. Saturday is usually the busiest day, since people who work during the week and farm part-time can attend, and others show up, hope to convince a vendor to sell them something at a bargain price rather than fool with taking it home.
How long can agriculture continue its strong run with a sagging dollar and energy prices now on a wild ride? That's anyone's guess—best left to an ag economist. But it's obvious that like usual, farmers are doing their best to maximize their individual profit opportunities.
For one farm, that's switching to all soybeans this year, just to get away from high dollar fertilizer inputs for corn. While it may not be a smart practice to follow forever, it certainly pencils out to be cheaper to put out all beans than to invest in high-priced nitrogen fertilizer for corn.
If agriculture is headed for a speed bump, it hasn't appeared yet. Stay tuned.