By Scout Nelson
Recent reports from the USDA National Agricultural Statistics Service (NASS) have shed light on cash rents in Nebraska, prompting a deeper examination of changes over the past eight years from 2016 to 2024. While NASS did not provide data for each class of land—irrigated, dryland, and pasture—in every county, enough information is available to illustrate overall market trends.
In general, cash rents across the three land classes have risen in 2024 compared to 2016. Specifically, rents for irrigated and dryland land have increased by an average of 15%, while pasture rents have gone up by 16%. Notably, Kimball County saw the largest hike for irrigated land at 37%, followed by Madison County at 28%, and Franklin and Colfax Counties at 26%. However, Box Butte County was the only area where rents for irrigated land decreased, showing a 9% drop.
Dryland cash rents experienced significant growth as well, with Box Butte (60%), Holt (53%), and Sherman (43%) Counties reporting the highest increases. Conversely, seven counties recorded lower rents on dryland this year.
In terms of pasture, Kimball (76%), Thomas (67%), and Howard (43%) Counties showed substantial gains, while eight counties reported declines, with Boone County experiencing the most considerable drop at 27%.
An interesting observation is that the range of changes in irrigated land rents is narrower than that for dryland and pasture, likely due to the variability in yield and production with irrigation compared to the unpredictability of dryland and pasture productivity.
Moreover, cash rent growth has not kept pace with rising land values. For instance, irrigated land values surged by 33%, from $6,430 to $8,550 per acre, while cash rents only rose by 15%. Similar trends are seen in dryland and pasture values, which increased by 44% and 57%, respectively, compared to lower rent increases.
Looking ahead, agricultural economists anticipate potential negative returns for cash-rented farmland, which could lead to downward adjustments in rents. However, historical trends suggest that these adjustments may not fully reflect downturns in farm returns, as landowners are often hesitant to raise rents rapidly to maintain good tenant relationships.
Consequently, while downward pressure on rents is expected, adjustments may lag actual market conditions.
Photo Credit: usda
Categories: Nebraska, General