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Iowa Farmland Values – Winter 2022

Executive Summary The price of farmland in Iowa grew 17% year-on-year, commanding more than $11,100 per acre. This follows a similar 17% increase in 2021.  High valuations brought a historically significant volume of acreage to the market in 2022, surpassing the previous record in 2021.  These increases were primarily driven by growth in farmer savings over the last three years fueled by high commodity prices, increasing government payments and low-interest rates. These low-interest rates also enabled farmers to obtain larger loans to purchase more land, adding pressure to land values and creating competition for farmland coming to the market. [READ: Forecasting 2023 Farmland Values: Will U.S. Land Prices Decrease in 2023?] Why Are Iowa Farmland Values Important?  Farmland is an essential asset for most farmers in terms of value and importance for their long-term success. At FBN®, our team of data scientists and appraisers puts Farmers First® by continuously monitoring the farmland market to provide transparent, timely and actionable insights. We believe that delivering trusted reporting is essential to creating a better farmland marketplace that’s more fair for farmers — whether buying, selling, or refinancing. The analysis below delivers data-driven insights on trends related to Iowa farmland values by exploring:  Why farmland values increased nationally in 2022  Broad, state-level trends in transaction values and sales volume A detailed analysis of each of the nine United States Department of Agriculture (USDA) agricultural districts in the state. [READ: Why Did National Farmland Values Increase in 2022?] Trends in Iowa Farmland Values Localized analysis is essential for understanding how soil quality, yield, and farm revenue shape farmland values across Iowa. The cost of land per bushel of production helps optimize investment options with higher returns. Similarly, the slope of yield gain helps assess long-term expected yield for a given parcel. Soil Quality Impacts Soil quality is one of the main drivers of farmland values. In Iowa, the Iowa Corn Suitability Rating (CSR2) is a widely used index for rating the relative quality of the soils. Using the CSR2, we categorize Iowa’s farmland parcels into three soil quality levels, each of them representing an equal total area.  (See Methods section at the end of this postfor details about the limits for each soil quality class.)  Because different districts have different average CSR2 scores, a different proportion of each of the three soil quality categories is represented in the area. To determine the year-on-year change in value, we compared farmland values from the last six months of 2021 with the same period in 2022.  At the state level, the soil quality with the most significant percentage change was the Low class, with 42.0%.  On the other end, the soil quality with the lowest change in price was the Medium class, showing a 21.0% difference. Regional Land Value Growth  Land values increased in all nine districts. The largest percentage changes were in the Northeast and Southwest districts, with 35.4% and 22.2%, respectively. The Southeast and West Central districts saw the smallest percentage change, with 10.7% and 3.4%, respectively.  The highest average land values were observed in Northwest Iowa, at $14,010 per acre. The lowest average land values were seen in South Central Iowa, at $6,090 per acre. Transaction Volume  Transaction volume was at a record high in 2022, representing the highest volume of the last thirteen years. The total area sold was 30% higher than the previous year (2021) and 220.6% higher than the last thirteen years’ average (2010-2022). Summary The price of farmland in Iowa grew 17.0% year-on-year, commanding more than $11,100 per acre.  High valuations brought a historically significant volume of acreage to the market in 2022, surpassing the previous record in 2021.  Localized analysis is essential for understanding how soil quality, yield, and farm revenue shape farmland values across Iowa. The cost of land per bushel of production helps optimize investment options with higher returns. Similarly, the slope of yield gain helps assess long-term expected yield for a given parcel. [Curious about trends in other states? Check out the Minnesota Farmland Values Analysis or the Illinois Farmland Values Analysis . ] Trends by Region: Central Iowa The Central region is 72.2% cropland and 10.9% grassland/pasture. The primary crops grown are corn and soybeans.  In total, 13,805 ac were sold in Central IA in the last twelve months. This compares to an average of 3,521 ac per year sold between 2010-2022. Most sales occurred in the first quarter of the year — a total of 4,406 ac (31.9% of total annual sales).  Central Iowa Productivity and Economic Indicators One interesting metric is the price per bushel of grain. In this district, the soils with the highest CSR2 show a price of farmland per bushel of corn of 80 $/bu. On the other end, the soils with the lowest CSR2 show a price of farmland per bushel of corn of 55 $/bu. For soybeans, those values were 257 $/bu and 181 $/bu, respectively.  Central Iowa Soil Productivity and Yield Graph showing the relationship between ILPI and land price. Each point is a 2022 season sale, and the line shows the trend.  To calculate the value per ac for a different parcel, multiply the CSR2 of the parcel by 168.08 $/CSR2. The result is the estimated value of the parcel in $/ac. Boxes show the distribution of yields. The bottom of the box is the lowest 25% yield, the central line is the median (50%) yield, and the top of the box is the 75% yield. The bottom of the horizontal line is the 10% yield and the top of the horizontal line is the 90% yield. Central Iowa Yield Trends Average yield for 2015-2021 compared to 2008-2014 for Central Iowa. Crop yields in 2012 were anomalously low due to severe drought and were excluded from calculations. Trends by Region: East Central Iowa The East Central region is 61.9% cropland and 14.2% grassland/pasture. The primary crops grown are corn and soybeans.  In total, 6,984 ac were sold in East Central IA in the last twelve months. This compares to an average of 2,532 ac per year sold between 2010-2022. Most sales occurred in the first quarter of the year — a total of 2,604 ac (37.3% of total annual sales).  East Central Iowa Productivity and Economic Indicators One interesting metric is the price per bushel of grain. In this district, the soils with the highest CSR2 show a price of farmland per bushel of corn of 69 $/bu. On the other end, the soils with the lowest CSR2 show a price of farmland per bushel of corn of 56 $/bu. For soybeans, those values were 234 $/bu and 188 $/bu, respectively.  East Central Iowa Soil Productivity and Yield Graph showing the relationship between ILPI and land price. Each point is a 2022 season sale, and the line shows the trend.  In this district, we could not determine a clear relationship between CSR2 and farmland value. The R2 is 0.04, which is low and shows that there is too much noise to establish a relationship. Other factors may be affecting farmland values that are not captured by soil quality.  East Central Iowa Yield Trends Average yield for 2015-2021 compared to 2008-2014 for East Central Iowa. Crop yields in 2012 were anomalously low due to severe drought and were excluded from calculations. Trends by Region: North Central Iowa The North Central region is 81.4% cropland and 7.7% grassland/pasture. The primary crops grown are corn and soybeans.  In total, 10,857 ac were sold in North Central IA in the last twelve months. This compares to an average of 6,210 ac per year sold between 2010-2022. Most sales occurred in the fourth quarter of the year — a total of 3,641 ac (33.5% of total annual sales).  North Central Iowa Productivity and Economic Indicators One interesting metric is the price per bushel of grain. In this district, the soils with the highest CSR2 show a price of farmland per bushel of corn of 72 $/bu. On the other end, the soils with the lowest CSR2 show a price of farmland per bushel of corn of 46 $/bu. For soybeans, those values were 235 $/bu and 148 $/bu, respectively.  North Central Iowa Soil Productivity and Yield Graph showing the relationship between ILPI and land price. Each point is a 2022 season sale, and the line shows the trend.  In this district, we could not determine a clear relationship between CSR2 and farmland value. The R2 is 0.1, which is low and shows that there is too much noise to establish a relationship. Other factors may be affecting farmland values that are not captured by soil quality.  North Central Iowa Yield Trends Average yield for 2015-2021 compared to 2008-2014 for North Central Iowa. Crop yields in 2012 were anomalously low due to severe drought and were excluded from calculations.  Trends by Region: Northeast Iowa The Northeast region is 60.4% cropland and 15.5% grassland/pasture. The primary crops grown are corn and soybeans.  In total, 8,301 ac were sold in Northeast IA in the last twelve months. This compares to an average of 4,356 ac per year sold between 2010-2022. Most sales occurred in the second quarter of the year — a total of 2,879 ac (34.7% of total annual sales).  Northeast Iowa Productivity and Economic Indicators One interesting metric is the price per bushel of grain. In this district, the soils with the highest CSR2 show a price of farmland per bushel of corn of 57 $/bu. On the other end, the soils with the lowest CSR2 show a price of farmland per bushel of corn of 42 $/bu. For soybeans, those values were 197 $/bu and 143 $/bu, respectively.  Northeast Iowa Soil Productivity and Yield Graph showing the relationship between ILPI and land price. Each point is a 2022 season sale, and the line shows the trend.  In this district, we could not determine a clear relationship between CSR2 and farmland value. The R2 is 0.05, which is low and shows that there is too much noise to establish a relationship. Other factors may be affecting farmland values that are not captured by soil quality. Northeast Iowa Yield Trends Average yield for 2015-2021 compared to 2008-2014 for Northeast Iowa. Crop yields in 2012 were anomalously low due to severe drought and were excluded from calculations. Trends by Region: Northwest Iowa The Northwest region is 81.0% cropland and 8.0% grassland/pasture. The primary crops grown are corn and soybeans.  In total, 9,310 ac were sold in Northwest IA in the last twelve months. This compares to an average of 2,998 ac per year sold between 2010-2022. Most sales occurred in the first quarter of the year — a total of 3,622 ac (38.9% of total annual sales).  Northwest Iowa Productivity and Economic Indicators One interesting metric is the price per bushel of grain. In this district, the soils with the highest CSR2 show a price of farmland per bushel of corn of 79 $/bu. On the other end, the soils with the lowest CSR2 show a price of farmland per bushel of corn of 58 $/bu. For soybeans, those values were 268 $/bu and 196 $/bu, respectively.  Northwest Iowa Soil Productivity and Yield Graph showing the relationship between ILPI and land price. Each point is a 2022 season sale, and the line shows the trend.  In this district, we could not determine a clear relationship between CSR2 and farmland value. The R2 is 0.07, which is low and shows that there is too much noise to stablish a relationship. Other factors may be affecting farmland values that are not captured by soil quality. Northwest Iowa Yield Trends Average yield for 2015-2021 compared to 2008-2014 for Northwest Iowa. Crop yields in 2012 were anomalously low due to severe drought and were excluded from calculations. Trends by Region: South Central Iowa The South Central region is 33.0% cropland and 38.2% grassland/pasture. The primary crops grown are soybeans and corn.  In total, 16,911 ac were sold in South Central IA in the last twelve months. This compares to an average of 3,186 ac per year sold between 2010-2022. Most sales occurred in the first quarter of the year — a total of 6,539 ac (38.7% of total annual sales).  South Central Iowa Productivity and Economic Indicators One interesting metric is the price per bushel of grain. In this district, the soils with the highest CSR2 show a price of farmland per bushel of corn of 69 $/bu. On the other end, the soils with the lowest CSR2 show a price of farmland per bushel of corn of 32 $/bu. For soybeans, those values were 219 $/bu and 96 $/bu, respectively.  South Central Iowa Soil Productivity and Yield Graph showing the relationship between ILPI and land price. Each point is a 2022 season sale, and the line shows the trend.  In this district, we could not determine a clear relationship between CSR2 and farmland value. The R2 is 0.14, which is low and shows that there is too much noise to establish a relationship. Other factors may be affecting farmland values that are not captured by soil quality.  South Central Iowa Yield Trends Average yield for 2015-2021 compared to 2008-2014 for South Central Iowa. Crop yields in 2012 were anomalously low due to severe drought and were excluded from calculations. Trends by Region: Southeast Iowa The Southeast region is 49.9% cropland and 20.9% grassland/pasture. The primary crops grown are corn and soybeans.  In total, 9,064 ac were sold in Southeast IA in the last twelve months. This compares to an average of 2,404 ac per year sold between 2010-2022. Most sales occurred in the first quarter of the year — a total of 3,499 ac (38.6% of total annual sales).  Southeast Iowa Productivity and Economic Indicators  One interesting metric is the price per bushel of grain. In this district, the soils with the highest CSR2 show a price of farmland per bushel of corn of 58 $/bu. On the other end, the soils with the lowest CSR2 show a price of farmland per bushel of corn of 37 $/bu. For soybeans, those values were 188 $/bu and 113 $/bu, respectively.  Southeast Iowa Soil Productivity and Yield Graph showing the relationship between ILPI and land price. Each point is a 2022 season sale, and the line shows the trend.  In this district, we could not determine a clear relationship between CSR2 and farmland value. The R2 is 0.14, which is low and shows that there is too much noise to establish a relationship. Other factors may be affecting farmland values that are not captured by soil quality.  Southeast Iowa Yield Trends Average yield for 2015-2021 compared to 2008-2014 for Southeast Iowa. Crop yields in 2012 were anomalously low due to severe drought and were excluded from calculations. Trends by Region: Southwest Iowa The Southwest region is 67.0% cropland and 18.6% grassland/pasture. The primary crops grown are corn and soybeans.  In total, 7,612 ac were sold in Southwest IA in the last twelve months. This compares to an average of 2,604 ac per year sold between 2010-2022. Most sales occurred in the first quarter of the year — a total of 3,914 ac (51.4% of total annual sales).  Southwest Iowa Productivity and Economic Indicators One interesting metric is the price per bushel of grain. In this district, the soils with the highest CSR2 show a price of farmland per bushel of corn of 58 $/bu. On the other end, the soils with the lowest CSR2 show a price of farmland per bushel of corn of 31 $/bu. For soybeans, those values were 189 $/bu and 94 $/bu, respectively.  Southwest Iowa Soil Productivity and Yield Graph showing the relationship between ILPI and land price. Each point is a 2022 season sale, and the line shows the trend. In this district, we could not determine a clear relationship between CSR2 and farmland value. The R2 is 0.17, which is low and shows that there is too much noise to establish a relationship. Other factors may be affecting farmland values that are not captured by soil quality.   Southwest Iowa Yield Trends Average yield for 2015-2021 compared to 2008-2014 for Southwest Iowa. Crop yields in 2012 were anomalously low due to severe drought and were excluded from calculations.  Trends by Region: West Central Iowa The West Central region is 76.5% cropland and 11.3% grassland/pasture. The primary crops grown are corn and soybeans.  In total, 14,392 ac were sold in West Central IA in the last twelve months. This compares to an average of 2,514 ac per year sold between 2010-2022. Most sales occurred in the first quarter of the year — a total of 4,598 ac (31.9% of total annual sales).  West Central Iowa Productivity and Economic Indicators One interesting metric is the price per bushel of grain. In this district, the soils with the highest CSR2 show a price of farmland per bushel of corn of 68 $/bu. On the other end, the soils with the lowest CSR2 show a price of farmland per bushel of corn of 45 $/bu. For soybeans, those values were 230 $/ bu and 151 $/bu, respectively.  West Central Iowa Soil Productivity and Yield Graph showing the relationship between ILPI and land price. Each point is a 2022 season sale, and the line shows the trend.  In this district, we could not determine a clear relationship between CSR2 and farmland value. The R2 is 0.11, which is low and shows that there is too much noise to establish a relationship. Other factors may be affecting farmland values that are not captured by soil quality.  West Central Iowa Yield Trends Average yield for 2015-2021 compared to 2008-2014 for West Central Iowa. Crop yields in 2012 were anomalously low due to severe drought and were excluded from calculations.  Methods The farmland transaction dataset analyzed in the report was drawn from public deed and property transaction records and enhanced with environmental geospatial data by FBN . Only fair market parcel transactions with >=20 ac and at least 70% area in agriculture land uses (cropland or pasture) were included in calculations.  We used the Iowa Corn Suitability Rating to classify soils into three quality tiers, each of them representing an equal total area:  High (CSR2 higher than 116)  Med (CSR2 65 to 82)  Low (CSR2 below 65)  Yield trends across regions and soil quality groups were calculated using FBN field-level yield estimates for corn and soybeans. The FBN yield estimates shown here leverage farmer contributed yield data to help identify patterns between yields and data layers including satellite imagery, weather, soil and more. No farmer contributed yield data was used directly in estimating yields by soil and region.  Direct income ($/ac) was estimated for both corn and soybeans to document how both changes in yield and basis across the state may shape farmland values. To estimate direct income, we simply multiply the estimated per acre yield with the typical grain price received around harvest (September-November) in that year, assuming no storage or drying fees.  More information about grain prices can be found on the FBN Profit Center website .  Land Loans and Farm Financing with FBN® Finance* Whether you’re expanding your Iowa farm with a land purchase, refinancing, or making improvements, FBN Finance can help you secure the capital you need to build a stronger financial future. You could save thousands by financing your farm or ranch at a great rate with a nationwide team that knows ag. Apply in just minutes using our secure and straightforward online loan application . Complete the form below or click here to connect with a member of our team today .  Any charts and graphs provided are for illustrative purposes only. Any performance quoted represents past performance. Past performance does not guarantee future results. Copyright © 2014 – 2023 Farmer’s Business Network, Inc. All rights Reserved. The sprout logo, “Farmers Business Network”, “FBN”, “Farmers First” are trademarks, registered trademarks or service marks of Farmer’s Business Network, Inc. Information in this report is provided for your individual informational use only, and may not be disclosed, reproduced, summarized, distributed, excerpted, or used for any reason other than for research purposes to aid in your potential purchase, sale, or rental of property. 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