Farmland is more than a production asset. For many farm operations, it is the largest component of the balance sheet, a key driver of long-term wealth, and one of the most important factors influencing business growth.
That is why understanding trends in farmland values and cash rents remains essential, particularly as agricultural markets adjust to tighter margins, elevated interest rates, and shifting economic conditions.
Producers across the Midwest continue to closely monitor farmland values, farmland prices, and cash rent trends as economic conditions evolve. While the pace of appreciation has moderated compared to recent years, agricultural land values remain historically strong across many markets. Along with tracking farmland values and farmland prices, many producers are also evaluating cash rent trends as they make decisions about growth, profitability and long-term land access.
During Farm Credit Mid-America's recent webinar, The Latest on Farmland Values and Cash Rents, David Widmar, Co-Founder and Managing Partner of Agricultural Economic Insights and Jennifer Riethman, Head of Collateral Production at Farm Credit Mid-America, shared perspectives on the current land market, emerging trends across the association's territory, and practical strategies producers can use when evaluating land opportunities.
Their message was clear: today's market is less about predicting what land values will do next and more about positioning your operation to capitalize on opportunities when they arise.
Understanding Today’s Farmland Values and Land Market Trends
At the association level, Farm Credit Mid-America's benchmark study showed a 7% year-over-year increase in farmland values across its five-state territory.
But that headline number only tells part of the story.
According to Riethman, today's farmland market is increasingly defined by regional differences. While traditional crop-producing regions continue to be influenced primarily by commodity economics, other areas are experiencing strong demand from cattle production, recreation, residential growth, and lifestyle buyers. Those varying influences have created what Riethman described as "split markets," where the drivers behind land appreciation can differ significantly from one region to the next.
What Makes the Benchmark Study Different?
Farm Credit Mid-America's benchmark study provides a unique lens into farmland values because it is built on appraisals of representative properties spread across the association's territory.
Twice each year, those properties are reappraised and compared against verified market sales, creating an apples-to-apples view of changing land values over time. Rather than relying solely on survey responses or producer perceptions, the study focuses on actual market evidence.
This approach helps identify trends while reducing some of the noise that can accompany broader state or national averages.
Benchmark Study Snapshot
- 7% year-over-year farmland value increase
- Multiple demand drivers across the region
- Continued land inventory constraints
- Strong demand from agricultural and non-agricultural buyers
Farmland Values Across Farm Credit Mid-America’s Territory
The webinar highlighted several noteworthy trends across the association.
Indiana: Buyers Becoming More Selective
Following significant appreciation between 2021 and 2023, Indiana farmland values have largely stabilized. Some areas have experienced slight softening, but presenters emphasized that modest annual changes should generally be viewed as a stable market rather than a major correction.
One notable shift is that land quality has become increasingly important. Buyers are paying closer attention to productivity, location, and long-term return potential when making purchasing decisions.
Ohio: Growth Supported by Multiple Demand Drivers
Ohio continues to see strength in farmland values, supported by several market forces.
Population growth around Cincinnati, Columbus, and Cleveland remains a contributor, while major economic development projects near Columbus continue to influence surrounding land markets. Strong cattle economics and ongoing recreational land demand are also helping support values in portions of the state.
Kentucky: Agriculture and Lifestyle Demand
Kentucky's land market continues to benefit from a mix of influences. Strong cattle markets, recreational demand, investment interest, and population growth all contribute to farmland appreciation in many areas. Central and eastern Kentucky also continue to see demand tied to equine operations and rural lifestyle properties.
Tennessee: Affordability Shaping Buyer Behavior
Tennessee may be one of the most interesting land value stories in the region.
While appreciation in Middle Tennessee has moderated compared to previous years, strong demand remains. Rising prices in that area have pushed some buyers into eastern Tennessee and nearby markets in search of more affordable opportunities, creating continued support for land values across a broader geography.
Why Limited Farmland Supply Continues to Support Farmland Prices
Another trend receiving close attention is the limited supply of farmland going on the market.
According to Riethman, Farm Credit Mid-America continues to observe fewer land transactions than in previous years. While market conditions can change, reduced inventory creates scarcity and can help support farmland values, even during periods when farm profitability is under pressure.
For producers looking to expand, that may mean fewer opportunities and increased competition when desirable properties become available.
Looking Back: Why Predicting the Market Is So Difficult
Widmar challenged the viewers to think back to August 2020 and ask themselves a simple question:
Would you have been excited to buy farmland at that time?
At the time, corn prices were low, demand uncertainty was widespread, and producers faced significant economic questions following the disruptions of the pandemic. There was little indication that farmland values were about to begin one of the strongest appreciation periods in recent history.
Yet within months, commodity markets improved, export demand accelerated, and government assistance programs provided support to producers. The result was a dramatic shift in farm profitability and land values.
The lesson is important: major market movements are often difficult to predict before they occur.
How to Prepare for Future Farmland Purchase Opportunities
Rather than attempting to forecast the next farmland boom or correction, Widmar encouraged producers to focus on something they can control: financial positioning.
Today's environment presents challenges for both buyers and renters. Elevated land values, higher borrowing costs, and tighter margins have increased the importance of disciplined financial planning.
Producers considering future land purchases may benefit from:
- Building liquidity and savings for larger down payments
- Reducing existing debt obligations
- Preserving borrowing capacity
- Understanding their debt service limits
- Identifying acquisition goals before opportunities emerge
Widmar emphasized that many successful land purchases are the result of preparation long before a tract becomes available. Knowing your limits in advance can help remove emotion from the decision-making process and keep growth aligned with the operation's financial goals.
Rethinking the "Fair Rent" Conversation
The discussion also addressed a question many producers face every year: How do you determine a fair cash rent?
The presenters suggested moving away from the idea of a single "fair" number and instead approaching rent discussions as collaborative negotiations. Producers who arrive prepared with profitability data, production costs, and market information are often better positioned to communicate their perspective. Just as importantly, listening to a landowner's priorities can reveal opportunities that extend beyond price alone.
Long-term stability, property improvements, flexible lease structures, and shared-risk arrangements may create value for both parties.
The webinar also highlighted growing interest in flexible and hybrid lease agreements that allow landlords and tenants to share both risk and reward during periods of market volatility.
What Producers Should Do Now
The farmland market remains resilient, but the factors influencing land values are becoming more complex. Commodity economics, recreational demand, population growth, livestock profitability, development pressure, and limited land supply are all contributing to today's landscape.
The most successful producers will not necessarily be those who predict the next market move. They will be the ones who prepare for it.
As you evaluate opportunities in the coming year, consider taking the following steps:
- Monitor land trends in your local market, not just statewide averages.
- Review your balance sheet and borrowing capacity with your financial officer.
- Define your long-term land ownership and growth goals.
- Establish financial boundaries before purchase opportunities arise.
- Approach cash rent conversations with preparation and open communication.
- Lean on trusted advisors who understand both your operation and your local market.
Take the Next Step
If you want to better understand farmland values, cash rent trends, or market conditions in your area, contact your local Farm Credit Mid-America financial officer. They can help you access regional insights from the benchmark study, evaluate opportunities, and develop a strategy that aligns with your operation's goals.
Because in today's market, success isn't about predicting what happens next. It's about being prepared when opportunity arrives.
Frequently Asked Questions About Farmland Values
Are farmland values still increasing?
Farmland values remain strong across much of Farm Credit Mid-America's territory, though appreciation rates vary by local market and land type.
What affects farmland prices?
Farmland prices are influenced by commodity markets, farm profitability, interest rates, development pressure, recreational demand, livestock economics, and available land supply.
Why are farmland values different between regions?
Local economic conditions, population growth, agricultural productivity, and competing land uses can all influence farmland values differently from one region to another.
How can producers prepare to buy farmland?
Building liquidity, preserving borrowing capacity, reducing debt, and establishing financial goals can help producers act when farmland opportunities become available.
Why are farmland prices remaining strong?
Limited land supply, livestock profitability, recreational demand, population growth, and development pressures continue to support farmland prices.
What should producers do before buying farmland?
