New record in price for land
Farm land prices in Stutsman County hit another new record with the sale of three quarters located northeast of Courtenay Thursday. Two of the quarters sold for $4,100 per acre, according to Andy Mrnak, auctioneer for Pifer's Auction and Realty.
"I think that is a new record for that area," he said. "It was one of the best attended land auctions we've had."
A sale of farm land near Spiritwood for $3,450 per acre on June 6 was considered the record for Stutsman County farm land sales at that time.
Mrnak said both parcels went to local buyers. One quarter sold to the farmer who had already been leasing the property.
"There was some interest from out-of-state investors but the local farmers were more aggressive," Mrnak said.
Dwight Aakre, farm management specialist for the North Dakota State University Extension Service, wasn't surprised by the high prices.
"It's a common situation with farm land prices rising at unsustainable levels," he said. "I know they are going up, I don't know when it will peak."
Aakre said there are several factors driving up land values.
"The change in crops is huge," he said. "Corn and soybeans return more revenue than the wheat and barley we use to grow."
Aakre said those commodities are particularly volatile because prices depend on exports and ethanol production. Both of those markets can be affected by the political climate.
Other factors include good yields and prices and low interest rates. All of the factors combine to give farmers confidence to pay record prices for land, Aakre said. Another factor is the financial position of some farmers. Good yields and prices have provided many with money in the bank that is yielding low interest rates.
"A lot of these sales are cash or mostly cash sales," Aakre said.
Mrnak said high prices have increased the number of people looking to sell land.
"There is no way to tell if it has peaked," he said. "But it does have a lot of people thinking about selling."
Sun reporter Keith Norman can be reached at 701-952-8452 or by email at email@example.com