Survey features prices, trends outlooks

BLOOMINGTON, Ill. — The Illinois Society of Professional Farm Managers and Rural Appraisers annual survey not only digs deep into farmland values across the state, but also expectations and trends.

Gary Schnitkey, University of Illinois farm management specialist and ISPFMRA secretary/treasurer, provided a rundown of the survey findings at the Farmland Values Conference on March 21.

Here are some of the findings:

2024 Price Expectations

Farmland prices have increased a great deal in recent years, but according to the survey, most respondents expect farmland prices to either remain the same or decrease in 2024.

The survey found 49% of respondents expect a farmland price decline of 5% or less; 13% expect decreases of between 5% and 10%; 2% expect a decrease of more than 10%; and 32% expect farmland prices unchanged in 2024.

Farmer Buyers

Farmers accounted for 59% of the buyers, with 57% being local farmers and 2% being relocating farmers.

Individual investors who would not farm the land were the next largest group, accounting for 30% of the buyers.

Local investors accounted for 17% of the buyers and non-local investors accounted for 13%. Institutions accounted for 6% of all buyers.

Corn Prices

The survey indicated 60% expect corn prices to be less than $4.50 per bushel in 2024; 37% expect corn prices between $4.50 and $5.50; and 3% expect corn prices to be above $5.50 per bushel.

Overall, survey respondents are anticipating substantial declines in corn prices. This stands in contrast to the 2022-2023 marketing year where U.S. farmers received an average of $6.54 per bushel.

Costs

Most of the respondents, 53%, expect costs to be the same for 2024, 36% expect declines and 21% expect increases.

Carbon, Energy Markets

Of the farm managers responding, 4% had some of their farms enrolled in carbon markets. Only 29% of farm managers are interested in carbon markets.

To be interested in carbon markets, 67% of respondents said payments would have to exceed $30 per acre, 8% said between $20 and $30 per acre and 4% said it needed to be between $10 and $20 per acre.

Overall, 15% of farm managers expect a very small percentage of Illinois acres to be enrolled; 35% expect less than 10% of the state’s acres to be enrolled in a carbon market; and 30% expect between 10% and 25% of the Illinois acres enrolled.

The survey found 72% of farm managers said they had a wind project on one of the farms they managed, with 84% expecting wind projects to increase in the state.

Additionally, 24% of farm managers responding have a solar project on one of their farms. Furthermore, 96% expect solar projects to increase in the state over the next five years.

Lease Agreements

In 2024, traditional cash rent arrangements will account for 30% of leases, variable cash rent is at 34% of the arrangements and traditional crop share represents 20% of the agreements.

“This has not changed much from year to year, but over time you see a movement towards cash rent and variable cash rent,” Schnitkey said.

2025 Rent Expectations

None of the farm managers surveyed expect an increase in cash rents, 20% expect 2025 cash rents to be the same as in 2024 and 80% expect 2025 cash rents to decrease from 2024.

“Overall, there are expectations of downward pressure on cash rents moving into 2025, not a dramatic fall, but some modest movements down in cash rents going into 2025,” Schnitkey said.