2014 Farm land value trends in Wisconsin
Arlin Brannstrom, Center for Dairy Profitability
UW-Madison College of Agricultural and Life Sciences
Phone (608) 265-3030
2:46 – Total Time
0:19 – 2013 land prices steady
0:44 – Land price examples
1:19 – 2014 land prices jump
1:40 – Strong dairy, strong land values
1:54 – What forms land prices
2:16 – The dairy influence
2:37 – Lead out
Sevie Kenyon: Arlin, can you give us an idea of what happened to land prices last season?
Arlin Brannstrom: Well in a nutshell the average price of agricultural property between unrelated parties here in Wisconsin was pretty much unchanged last year. We try to analyze information that comes from transfer return data across the state, and statewide that didn’t change very much. Now, in some parts of the state land sales values did jump quite a bit.
Sevie Kenyon: Arlin can you give us some examples from land prices around the state?
Arlin Brannstrom: Sure can. If you look at southeastern Wisconsin, which of course has the largest competition with population, so far that’s the area with the highest land values for ag land. And now we’re talking about thirty five acres and above of land, currently being assessed for agricultural purposes, and in that case, the average was pretty close to six thousand dollars an acre. That’s quite a bit higher obviously than some parts of the state. If we look at the north central or west central Wisconsin, the average there is probably closer to three thousand dollars an acre.
Sevie Kenyon: Arlin have you looked at the numbers so far in twenty-fourteen?
Arlin Brannstrom: We have had a chance to recently get the first three months of this year. We had a big jump in land values. We’re up about eight hundred dollars an acre. This is a kind of preliminary number but it reflects the sale of about eighteen thousand acres here in twenty-fourteen. So it’s a pretty good representative sale number.
Sevie Kenyon: And what do you suppose caused that jump this year?
Arlin Brannstrom: I think it correlates pretty directly to the milk prices. When the profitability in the dairy industry looks strong, we see an immediate response in the land values.
Sevie Kenyon: Arlin what kinds of things go into the cost of land?
Arlin Brannstrom: If you look at agricultural land values, probably the biggest driver of that value is productivity. Productivity is, by that I mean the percent of the land that is tillable, the soil types, location, and proximity to agricultural markets…those are big drivers.
Sevie Kenyon: And Arlin how does the dairy business in Wisconsin influence the land prices here?
Arlin Brannstrom: Obviously there are two sides to that question. One is, what is the potential productivity for the land for growing dairy feed? And another is, what is its capability for managing dairy nutrients? We do see that in areas of the state where there’s large dairy concentrations, those land values are pretty strong right now, especially with the high milk prices.
Sevie Kenyon: We’ve been visiting with Arlin Brannstrom, Center for Dairy Profitability, University of Wisconsin and the College of Agricultural and Life Sciences, Madison, Wisconsin, and I am Sevie Kenyon.This entry was posted in Economic and Community Development, Podcals and tagged Center for dairy profitability by . Bookmark the permalink.