North Dakota pastureland values were up sharply statewide with an overall increase of approximately 11.5%, says Bryon Parman, North Dakota State University (NDSU) Extension agricultural finance specialist. The state average price per acre increased from $972 per acre in 2021 to $1,080 per acre in 2022, according to county-level data complied from the North Dakota Department of Trust Lands annual survey posted online at https://www.land.nd.gov/resources/north-dakota-county-rents-prices-annual-survey.
Due to insufficient data, rental rates for the northeast, northern Red River Valley and southern Red River Valley are not reported here.
All regions except for the south-central region increased well over 10%. The largest increase occurred in the northwest region at 16.7%, while the southeast increased nearly 15.5%. The east-central and southwest regions both increased between 12% and 13% while the north-central increased just over 10%.
“The only reported region that did not see a large increase was the south-central region, increasing nearly 1%,” says Parman. “However, in previous years it was the only region to post consistent gains while other areas have been somewhat up and down.”
The costliest pastureland in North Dakota remains in the southeast at $1,559 per acre followed by the south-central region at $1,137 per acre. The east-central was $1,119 per acre in 2022 followed by the southwest region at $1,033 per acre. The northwest and north-central regions remain under $1,000 per acre at $751 and $890 per acre, respectively.
Pastureland cash rents were unchanged statewide remaining at $21 per acre in 2022 which was the same as 2021. However, there were areas of the state that did experience increases while others showed decreases. Regions of North Dakota that saw increases in pastureland cash rents include the north-central, southwest and east-central regions. The north-central region increased 4.5%, the southwest increased 6.3% and the east-central increased 2.6%.
The remaining regions showed decreases including the northwest, south-central and southeast regions. The northwest decreased 5.4%, the south-central decreased 0.85%, and the southeast decreased 3.6%. The combination of increases and decreases in regional rental rates canceled each other out such that the statewide rate remained at $21 per acre.
“While it is common for rental rates and pastureland values to move by different amounts within the data, such that values may increase by double digits while rental rate increases are in the lower single digits, it is less common for values to increase so remarkably while rents remain unchanged (or possibly decline),” says Parman.
“This situation is likely due to the drought that North Dakota experienced in 2021, with some areas continuing to be impacted in 2022,” says Parman. “Land purchases are a longer-term investment and recent precipitation amounts have less of an impact in the short run, while rental rates may indeed be impacted by available standing or predicted forage amounts.”
Source : ndsu.edu