Welcome!

News Feed Item

Farmland still good investment, with farms on solid footing

COLUMBIA CITY, Ind., March 13, 2014 /PRNewswire/ -- Demand for farmland remains strong, and recent land prices are fundamentally sound even after several years of surging prices, farmland auctioneer R.D. Schrader told farmers, farmland investors, bankers and others in a series of updates on the current market.

Schrader, president of Schrader Real Estate and Auction Company, offered his comments in briefings held in Sarasota, Boston and Indianapolis.

"Farmland values may have attracted a lot of attention during the past few years, but those with a longer frame of reference understand that we didn't get here overnight. Farmland values have gone up in 25 of the last 26 years, and yet valuations continue to be well founded," said Schrader. 

He reviewed data from a variety of sources, including the Chicago Federal Reserve Bank, the National Agricultural Statistics Services, Purdue University and Iowa State University, showing that while some states and time periods were weaker than others, the overall upward trend remains intact.

Much of the increase during 2013 occurred during the first half of the year, he acknowledged. Even so, the Federal Reserve reported a 6 percent increase through Jan. 1, 2014, in the price of "good" farmland for the five states in the Seventh District (Illinois, Indiana, Iowa, Michigan and Wisconsin). The only state in the district showing a decrease for the year was Iowa, for which the Federal Reserve noted a 2 percent decline for the entire year.

"America's farms are on a solid footing. It's been farmers, the operators, that have been driving this market. It wasn't 100 percent financing that got us here," he said.

"Debt-to-equity ratios are in a 10-13 percent range – as low as they've been in the last 50 years," said Schrader, also noting that debt-to-income ratios are "awfully good, though changes in income and farmland values will change those ratios."

Schrader said softening corn and soybean prices may be a challenge to farm incomes going forward. "Volatile corn prices, especially, have been a concern, with current prices very close to the breakeven point for many farmers. While some operators may struggle with income fluctuations, the industry as a whole remains strong. The dynamics today differ starkly from those of the 1970s leading into the 1980s," he said.

Among other factors that tend to impact farmland prices, interest rates remain at historic lows and government support for ethanol is likely to continue at current levels, he said.

"The big elephant in the room as far as demand goes is these world populations and rising incomes," said Schrader, citing figures showing that by 2050, the world population will require a 100 percent increase in the world food supply. "Growth in other countries' populations and wealth will have a big impact on the demand side for U.S. agriculture. On the supply side, it will be interesting to see how the technology keeps production growing to meet demand," he said.

In evaluating values achieved in recent sales, Schrader said it's important to be mindful of the soils and productivity of a given farm.

"It's critical to get an apples to apples comparison. We've had a lot of cases where people compare farms in a specific county without taking into account the difference in soils," said Schrader. To illustrate his point, he pointed to three adjacent properties sold by Schrader on the same day – Nov. 15, 2012 – in Pulaski County, Ind. The best land sold for $10,576 per acre, while the tracts with more trees or poorer soil brought $4,500 per acre and $4,083 per acre.

"This was the same auction company, with all the same buyers, with all the same money in their pockets," said Schrader. The tract with sandy loam soil, he said, brought more than twice a neighboring tract with poorer soil.

Schrader Real Estate and Auction Company, based in Columbia City, Ind., is a leading auctioneer of agricultural land throughout the United States and is a four-time USA Today/National Auctioneers Association Auction of the Year Winner, as well as a two-time winner of the Grand Champion Marketing Award of Excellence.

For more information:
Carl Carter, 205-823-3273

SOURCE Schrader Real Estate and Auction Company

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
In his session at @DevOpsSummit at 20th Cloud Expo, Kelly Looney, director of DevOps consulting for Skytap, showed how an incremental approach to introducing containers into complex, distributed applications results in modernization with less risk and more reward. He also shared the story of how Skytap used Docker to get out of the business of managing infrastructure, and into the business of delivering innovation and business value. Attendees learned how up-front planning allows for a clean sep...
IoT is at the core or many Digital Transformation initiatives with the goal of re-inventing a company's business model. We all agree that collecting relevant IoT data will result in massive amounts of data needing to be stored. However, with the rapid development of IoT devices and ongoing business model transformation, we are not able to predict the volume and growth of IoT data. And with the lack of IoT history, traditional methods of IT and infrastructure planning based on the past do not app...
Internet-of-Things discussions can end up either going down the consumer gadget rabbit hole or focused on the sort of data logging that industrial manufacturers have been doing forever. However, in fact, companies today are already using IoT data both to optimize their operational technology and to improve the experience of customer interactions in novel ways. In his session at @ThingsExpo, Gordon Haff, Red Hat Technology Evangelist, shared examples from a wide range of industries – including en...
To get the most out of their data, successful companies are not focusing on queries and data lakes, they are actively integrating analytics into their operations with a data-first application development approach. Real-time adjustments to improve revenues, reduce costs, or mitigate risk rely on applications that minimize latency on a variety of data sources. Jack Norris reviews best practices to show how companies develop, deploy, and dynamically update these applications and how this data-first...
In IT, we sometimes coin terms for things before we know exactly what they are and how they’ll be used. The resulting terms may capture a common set of aspirations and goals – as “cloud” did broadly for on-demand, self-service, and flexible computing. But such a term can also lump together diverse and even competing practices, technologies, and priorities to the point where important distinctions are glossed over and lost.
Intelligent Automation is now one of the key business imperatives for CIOs and CISOs impacting all areas of business today. In his session at 21st Cloud Expo, Brian Boeggeman, VP Alliances & Partnerships at Ayehu, will talk about how business value is created and delivered through intelligent automation to today’s enterprises. The open ecosystem platform approach toward Intelligent Automation that Ayehu delivers to the market is core to enabling the creation of the self-driving enterprise.
"At the keynote this morning we spoke about the value proposition of Nutanix, of having a DevOps culture and a mindset, and the business outcomes of achieving agility and scale, which everybody here is trying to accomplish," noted Mark Lavi, DevOps Solution Architect at Nutanix, in this SYS-CON.tv interview at @DevOpsSummit at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
"We're here to tell the world about our cloud-scale infrastructure that we have at Juniper combined with the world-class security that we put into the cloud," explained Lisa Guess, VP of Systems Engineering at Juniper Networks, in this SYS-CON.tv interview at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
Enterprise architects are increasingly adopting multi-cloud strategies as they seek to utilize existing data center assets, leverage the advantages of cloud computing and avoid cloud vendor lock-in. This requires a globally aware traffic management strategy that can monitor infrastructure health across data centers and end-user experience globally, while responding to control changes and system specification at the speed of today’s DevOps teams. In his session at 20th Cloud Expo, Josh Gray, Chie...
"We're a cybersecurity firm that specializes in engineering security solutions both at the software and hardware level. Security cannot be an after-the-fact afterthought, which is what it's become," stated Richard Blech, Chief Executive Officer at Secure Channels, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Consumers increasingly expect their electronic "things" to be connected to smart phones, tablets and the Internet. When that thing happens to be a medical device, the risks and benefits of connectivity must be carefully weighed. Once the decision is made that connecting the device is beneficial, medical device manufacturers must design their products to maintain patient safety and prevent compromised personal health information in the face of cybersecurity threats. In his session at @ThingsExpo...
In his session at 20th Cloud Expo, Mike Johnston, an infrastructure engineer at Supergiant.io, discussed how to use Kubernetes to set up a SaaS infrastructure for your business. Mike Johnston is an infrastructure engineer at Supergiant.io with over 12 years of experience designing, deploying, and maintaining server and workstation infrastructure at all scales. He has experience with brick and mortar data centers as well as cloud providers like Digital Ocean, Amazon Web Services, and Rackspace. H...
SYS-CON Events announced today that Grape Up will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct. 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Grape Up is a software company specializing in cloud native application development and professional services related to Cloud Foundry PaaS. With five expert teams that operate in various sectors of the market across the U.S. and Europe, Grape Up works with a variety of customers from emergi...
You know you need the cloud, but you’re hesitant to simply dump everything at Amazon since you know that not all workloads are suitable for cloud. You know that you want the kind of ease of use and scalability that you get with public cloud, but your applications are architected in a way that makes the public cloud a non-starter. You’re looking at private cloud solutions based on hyperconverged infrastructure, but you’re concerned with the limits inherent in those technologies.
Detecting internal user threats in the Big Data eco-system is challenging and cumbersome. Many organizations monitor internal usage of the Big Data eco-system using a set of alerts. This is not a scalable process given the increase in the number of alerts with the accelerating growth in data volume and user base. Organizations are increasingly leveraging machine learning to monitor only those data elements that are sensitive and critical, autonomously establish monitoring policies, and to detect...