Since the beginning of the year, the farmland market has not changed all that much. Doug Hensley, president of Hertz Real Estate Services, says that comes as farmers face low commodity prices, high interest rates and high input costs, causing producers to become more cautious and reluctant to buy capital, especially equipment.

“To be frank, it’s been really painful to watch, and our current markets are now well below break even levels for most farming operators.”

However, Hensley explains it is easier to say no to buying a tractor upgrade while not making a profit versus buying land. Demonstrated this summer, throughout June land sales were strong, even if there weren’t many of them. And Hensley adds they weren’t just token sales.

“An example in Douglas County, Illinois, south of Champaign, the last week of June there was a quarter section that sold above $22,000 an acre. And in western Iowa, a sale in Sac County, Iowa in mid to late June also topped 20,000 an acre.”

Hensley says these were sales that would be called surprising. And while 20k plus is not symbolic of the entire market, it does represent examples of strength. While he doesn’t believe farmers can plan for these types of sales, it’s clear there’s plenty of financial strength in the countryside.

“Another way to say it is one strong sale doesn’t define the market any more than one weak sale does. At this time, the farmland market will be neighborhood specific and farm specific, depending on its relative quality and the level of local sale volume.”

There is considerable liquidity in the countryside from profits made in 2021 through 2023 according to Hensley, but more and more farmers are protecting their finances. Ultimately, there has been enough demand for the current supply of farmland.