The rising price of farmland in Kentucky continues to slow down, according to a study by Farmers National Bank, which has 12 branches in the commonwealth.
Paul Schadegg is a senior vice president for Farmers National Bank. He said record prices for agricultural land in 2020 and 2021 began to level off in the last half of last year – a trend that continued the first six months of this year.
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“Overall, when we look at that, that graph, it’s been a steady increase in value over long periods of time. So for a producer, especially where they typically own land, that’s an asset that keeps growing for them.”
Schadegg said the price of agriculture land typically mimics the price of commodities, and over the last five years, many farm operators had extra money to bid for farms. He said while farmers continue to face higher interest rates and higher production costs, 70% of ag land sales are still to operators of other farms.
“When you’re bidding for farmland, you may be bidding against an investor and investor has no emotional attachment though. So they’ll bid up to a certain level, when it no longer meets their return on investment, they will step away from that market.”
Schadegg said overall, the steady increase in the value of farmland over long periods of time is an asset that keeps growing for farm producers.
This story is republished with permission from WEKU. Read the original.
John McGary is a Lexington native and Navy veteran with three decades of radio, television and newspaper experience. He comes to WEKU from The Woodford Sun, where he was editor while covering government meetings, reporting on community events and taking photographs. At the Sun, he won multiple awards for news and feature stories and columns. At WLEX-TV, John won a Midwest Regional Emmy for an investigative story about illegal dumping and in 2003, was named Best Television Reporter by the Kentucky Associated Press. In the Navy, he was named Print Journalist of the Year once and Navy Broadcaster of the Year twice. John’s radio experience includes news and starting a radio magazine show at NTC Guantanamo Bay, Cuba and co-hosting a morning news/talk show in Owensboro, Ky. while working for The Owensboro Messenger-Inquirer.
