Oklahoma Agricultural Land Value Update
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Transcript of Oklahoma Agricultural Land Value Update
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Oklahoma Agricultural Land Value Update
Roger Sahs, Extension SpecialistOSU Department of Agricultural Economics
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OK Land Values by Region, 2012
PanhandleTracts 39Size 595$/Acre $809% Chg +22.1
West-NorthwestTracts 171Size 250$/Acre $1310% Chg +5.2
North CentralTracts 112Size 170$/Acre $1608% Chg +6.5
NortheastTracts 286Size 284$/Acre $1634% Chg -3.0
East-NortheastTracts 33Size 195$/Acre $1828% Chg -6.0
South CentralTracts 101Size 237$/Acre $1574% Chg -2.2
SoutheastTracts 205Size 214 $/Acre $1548% Chg +4.6
State AveragesTracts 1114Size 257$/Acre $1468% Chg +2.1
SouthwestTracts 167Size 214$/Acre $1172% Chg +12.6
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District2012 One Year
Change3 Year Change
$/ac Percent Change
Panhandle 809 22.1 63.0
West-NW 1310 5.2 31.5
Southwest 1172 12.6 25.9
North Central 1608 6.5 22.3
South Central 1574 -2.2 7.3
Northeast 1634 -3.0 2.9
East-NE 1828 -6.0 3.5
Southeast 1548 4.6 14.5
OK Cropland 1566 10.8 32.8
OK Pasture 1512 -0.5 9.5
Oklahoma 1468 2.1 14.1
Recent Trends in Oklahoma Land Values
Source: www.agecon.okstate.edu/oklandvalues
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Oklahoma Cropland vs Pastureland Prices
Source: www.agecon.okstate.edu/oklandvalues
Upward but not steady climb in values.
“Boom to Bust” was only 30 years ago.
Major increase in values in recent years.
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Oklahoma Cropland and Pastureland Prices Nominal vs Inflation Adjusted (base year
2000)
Source: www.agecon.okstate.edu/oklandvalues
Cropland
Pasture
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1973-1975 Average ValueTracts >= 40 Acres and <= $3000/Acre
Source: www.agecon.okstate.edu/oklandvalues
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2010-2012 Average ValueTracts >= 40 Acres and <= $6000/Acre
Source: www.agecon.okstate.edu/oklandvalues
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Land prices going ahead…• Changes in the
environment– Farm Bill– Domestic economy– Global economy– Elections/policy– Interest rates
• Recreational uses– Wildlife habitat, wildlife population
• Development uses– Population growth– Per capita income
• Agriculture– Input prices– Cattle, wheat/feedgrain prices– Yields– Efficiency, productivity– Continued drought
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Key Land drivers looking ahead… Recent commodity prices and farm
incomes Interest rate levels Financial health of current buyers
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$/bu
shel
$ in
Bill
ions
Oklahoma Wheat Price and Net Farm Income
Source: ERS and NASS
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012$0
$1
$2
$3
$4
$5
$6
$7
$8
0.00
0.25
0.50
0.75
1.00
1.25
1.50
1.75
2.00
Net farm income Wheat Price
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Source: KC Federal Reserve Bank, July 2013
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Financial Strength
2013 Balance Sheet of the U.S. Farming Sector (forecast)
Total Farm Assets: Assets: $3.010 trillionTotal Farm Debt: $308 BillionTotal Farm Equity: Equity: $2.702 trillion
Debt to Equity Ratio: 11.4 Low!‐ ‐Debt to Asset Ratio: 10.2 Low!‐ ‐
Bottom-Line: Strong financial fundamentals for the Ag sector.Minimal Debt Leverage and Low Financial Stress!
Source: Economic Research Service, August 2013
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Source: KC Federal Reserve Bank, July 2013
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Source: KC Federal Reserve Bank, July 2013
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Resources
• Agecon.okstate.edu/oklandvalues• Kansas City Federal Reserve Bank– http://www.kc.frb.org/– Choose RESEARCH & DATA, then Economic Review or
Agricultural Credit Survey• USDA Ag Land Value Data and Reports– http://www.nass.usda.gov/Charts_and_Maps/Land_Values
_and_Cash_Rents/index.asp