Farm values dropped for the first time in 22 years, according to the USDA's Agricultural Land Values and Cash Rents Annual Summary.
Farm real estate values, a measurement of the value of all land and buildings on farms, averaged $2,100 per acre on Jan. 1, 2009, down 3.2% from 2008. The 3.2% decrease from 2008 is the first decline in farm real estate value since 1987.
Regional changes in the average value of farm real estate ranged from virtually no change in the Northern and Southern Plains regions to an 11% decline in the Mountain region.
The highest farm real estate values remained in the Northeast region at $4,830 per acre. The Mountain region had the lowest farm real estate value at $922 per acre.
Both cropland and pasture values are also down from the previous year, the USDA reports. Cropland values declined by $110 per acre (3.9%) to $2,650 per acre. In the Corn Belt, the average cropland value decreased 4% from the previous year to $3,870 per acre. However, in the Northern Plains and Delta regions, cropland values rose 1.6% and 0.6%, respectively.
Pasture value declined by $20 per acre (1.8%) from 2008 to $1,070 per acre. The Mountain region had the largest percentage decrease in pasture value, 16% below 2008.
According to the report, the contraction in the overall economy has caused less commercial and residential development in many regions. Livestock and crop commodity prices have declined from a year earlier, thus producers and investors are less optimistic than a year ago.
A decrease in the demand for recreational land has also contributed to the overall decrease in land values.