September 26, 2021

Halderman optimistic about farmland values

WABASH, Ind. — Farmland values have strengthened over the past 12 months, said F. Howard Halderman, president of Halderman Real Estate and Farm Management.

Halderman was a keynote speaker at a seminar hosted by the company Aug. 23.

He discussed the following trends:

• The number of farmland sales remains below normal, especially large tracts of land.

• Cropland values were stable for the last five years. For the last 12 months they’ve been moving up.

• Recreational, timber and rural residential values are higher due to low interest rates and COVID-19.

“Where farmland values go from here depends on three things: farm incomes, interest rates and supply,” Halderman said.

He is bullish about the future.

“We’re looking at profitable prices, low amount of debt, low interest rates and a low supply of farms for sell,” he said. “If you add all those together, that’s going to be bullish for farmland values.

“Biofuel demand remains low, but kind of steady. Hopefully that remains in place. Then you have world population growth. Trade deals are helping. Then we have this potential for inflation. Farmland is positively correlated to inflation.”

Meanwhile, Halderman said, those who are less optimistic about land value increases are asking “what ifs.”

What if:

• Pandemic affects demand and prices?

• Weather and trade impact prices?

• U.S. and global production is enough to lower commodity prices?

• Worldwide economy tanks, leading to lower demand?

• Trade agreements are formed, or not?

• New administration policy changes on biofuels?

• Interest rates eventually increase due to inflation concerns?

For more information about Halderman, visit www.halderman.com.

Erica Quinlan

Erica Quinlan

Field Editor