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A bright future for farmland owners

An agricultural real estate broker says the future for farmland owners is bright.

Doug Hensley with central Iowa-based Hertz Real Estate Services tells Brownfield his outlook is based on how commodity prices have withstood four consecutive years of record crop production.

“It’s a little surprising to me that commodity prices haven’t collapsed more than they have, given the fact that we just keep growing bigger and bigger crops.  In 2017, that’s not going to be the case.  I think we’ll be doing well across the country to grow trend-line.”

He says supply contractions from a smaller U.S. crop should be supportive to prices, leading to stronger land values in the near to medium term.

Hensley adds most farmland owners remain positioned well financially.

“Farmland in general is held in very strong hands currently.  And there’s some areas of weakness, like any market.  But I think more than anything, part of the reason the future is bright for farmland is because I just don’t see any structural defects in ownership in the market right now.”

Hensley says there’s enough wealth amongst farmers that when a good piece of land becomes available, a lot of people can compete for it.