Survey shows 9 percent of Midwest land to change hands

The USDA’s National Agricultural Statistics Service recently released findings from a national survey of agricultural landowners conducted earlier this year, and the results show nearly one-tenth of Iowa land could belong to new owners five years from now.

Much of Iowa’s farmland is owned by individuals or entities based in other states, and rented or leased to Iowa farmers and ranchers. However, if projections are accurate, about 9 percent of land in Iowa and some surrounding states could be involved in transactions within the next five years — which could lead to fewer larger cooperate farms or more smaller privately-run farms.

Some of these transactions allow century farms — which have been with the same family for more than 100 years — and 150-year heritage family farms to remain in the hands of longtime farm families. Some of this land is rented out to others to farm, but this keeps the U.S. from losing agricultural land to competing international cooperate pressures.

The survey, called the 2014 Tenure, Ownership and Transition of Agricultural Land (TOTAL) survey, tells farmers a great deal about the 39 percent of farmland — some 354 million acres — that land owners rent out for agricultural purposes.

Almost half of the land transfer will take place through trust arrangements, the survey revealed.

The data is one of the largest packages of agricultural landownership information NASS has provided since conducting a similar survey in 1999. The most recent Census of Agriculture shows the U.S. has more than 900 million acres of farmland, which is about two-fifths of all American land.

These “acres rented out,” as they are called, are owned both by farmers who rent them to other farmers and ranchers and non-farming landlords, who may be individuals or participants in a partnership, trust, corporation or other arrangement. Farming landlords account for 20 percent of acres rented out, and non-farming landlords account for 80 percent.

The Midwest’s 9 percent anticipated transaction rate is slightly less than the 11 percent of land expected to change hands in the western plains and along the west coast. The Appalachians are the lowest at 6 percent predicted transferring; rugged mountain acreage doesn’t change hands as often as versatile, open ranch or farm expanses.

The total value of the land rented out (including the buildings on the land) was $1.1 trillion in 2014, according to the TOTAL survey. Landlords collectively received about $31.2 billion in rental payments against expenses of $9.2 billion, which puts their expenses (on average) at less than 30 percent of the rent received.

The majority of rented-out land is fully paid for without in-progress mortgages or loans, the study revealed. This was true for both farming and non-farming landlords.

The rented agricultural land is used for crops with 63 percent of the acres, while about 34 percent was used as pasture for livestock (the rest was buildings, ditches, ponds, etc.)

Landlords, in a few cases, also lease or sell various rights, including mineral rights, recreational rights, development rights and wind rights, especially in western mountain states that don’t tend to have the widespread fertile planting soil found in the Midwest.

Nationwide, about 10 percent of all U.S. farmland, or 91.5 million acres, is expected to transfer to new ownership in the next five years.

NASS conducted the TOTAL survey in partnership with USDA’s Economic Research Service, which plans to use the data in a wide range of upcoming economic studies.

See more at this link: http://1.usa.gov/1OllYFo