Bob Swires, President of the Illinois Society of Professional Farm Managers and Rural Appraisers, presented the association’s mid-year survey Friday at the 17th annual International Farm Management Congress Friday. Here are the findings for the first half of 2009:

1. Illinois Society members indicated that land values fell slightly during the first half of 2009. For excellent quality farmland, land prices declined by $171 per acre, or 2.3%. For fair quality farmland, the decline was $225 per acre, or 5.4%.

2. On July 1, 2009, farmland prices averaged $7,200 for excellent quality farmland, $6,300 for good quality farmland, $4,900 for average quality farmland, and $4,000 for fair quality farmland.

3. Volume of sales declined during the first half of 2009 compared to the first half of 2008. Eighty-eight percent of respondents indicated that volume of sales were less during the first half of 2009.

4. Fifty-six percent of the respondents expected sales to be less during the last half of 2009 as compared to the last half of 2008.

5. Half of the survey respondents expected declines in farmland prices over the next twelve months. Thirty-two percent expected stable prices.

6. Interest rates are expected to increase by 53% of survey respondents over the next year. Forty-seven percent expect stable interest rates. No respondents expect declines in interest rate

7. During the next twelve months, 63% of respondents expect Inflation rates to increase. Thirty-two percent expected inflation rates to remain stable and 5% expected declines in inflation rates

8. Survey respondents indicated that positive factors impacting farmland prices include 1) farmland is a tangible asset, 2) farmland is an inflation hedge, 3) financial assets carry a good deal of risk, and 4) interest rates are low.

9. Society members expect cash rents to decline slightly in 2010. Expected declines are between $10 and $15 from 2009 levels.

10. Expected cash rent levels for 2010 are $260 for excellent quality farmland, $210 for good quality farmland, $160 for average quality farmland, and $130 for fair quality farmland.

11. Production costs in 2010 for growing corn and soybeans are expected to decline by 67% of Society members.

12. The average charge for grain storage is $.1435 per bushel.

13. Average rent for pasture land is $35 per acre

What do you expect to happen to farmland prices over the next 12 months?

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