Mississippi Land Trends 2016
Crop commodity prices in 2014 were much lower than in previous years. However, the momentum of land values trending upward continued to carry cropland sales prices higher during the year. As a result, returns to land and profitability based on a 2014 sales price were low and, in many cases, negative. Early survey data from 2015 revealed a halt to the upward sales price trend for cropland. However, actual sales data from 2015 will determine exactly what impact 2 years of low commodity prices have had on quality cropland values.
The outlook moving forward for cropland sales prices hinges on how long commodity prices stay low, how long input costs stay high, and what happens with interest rates moving forward. Another low crop commodity price year may start a market correction for land sooner rather than later. Pastureland prices saw a sharp spike in value in 2014. However, the survey results suggest this movement upward may not have carried into 2015 as cattle prices failed to maintain their record high of $300 per hundredweight for long. Because the market did not stay near its record high, it probably will not require a substantial correction for pastureland values to settle where they will remain for the foreseeable future.
Full Text: Mississippi Agricultural Land Values Sales Report – 2015