Contact:  Julie Reuvers, U of M Extension Service, 612-626-4077, reuve007@umn.edu

Cropland rental rates continue to increase, U says

ST. PAUL, Minn. (6/28/2006)- Farmland rental rates continue to increase in 69 percent of Minnesota counties into 2006 and 2007, based on a report of historical analysis from the University of Minnesota.

The report, issued by the University of Minnesota Extension Service, is based on nine years of rental data from 1997-2005. It utilizes actual rental information from a database of nearly 2,400 Minnesota farmers enrolled in farm business management associations around the state.

"This report is simply a gauge for landowners and producers when trying to establish land rents," said Gary Hachfeld, Extension agricultural business management educator and co-author of the report. "The report is not meant to determine or set rents in any way."

More than 40 percent of total land in farms is rented in Minnesota, according to the U.S. Census of Agriculture. For that fact, this type of information is in high demand, according to Hachfeld.

The U of M report lists average rental rates by county for each year. Counties with a minimum of 15 farms reporting were included in the analysis. The projected rental rates were determined by drawing a statistical trend line that most closely matches the historical averages from 1997 through 2005. That trend line was then projected forward for two additional years.

"I think one of the things the report shows is that rents continue to rise over time," said Hachfeld, who worked on the report along with Extension economist Bill Lazarus and Dale Nordquist and Rann Loppnow from the U's Center for Farm Financial Management (CFFM). "That may or may not be bad, depending one's position."

The average annual changes in land rental values were the largest - 4 percent - in both central and southeast Minnesota, according to the report. The smallest average changes took place in the northwest (0.75 percent) and east central regions (1 percent).

The full report can be viewed on the CFFM website at www.cffm.umn.edu. Click on "publications," and then "farm management topics."

Source: Gary Hachfeld, University of Minnesota Extension Service Regional Center, Mankato (507) 389-6722

NOTE: News releases were current as of the date of issue. If you have a question on older releases, use the news release search (upper left-hand column of the News main page) or the main Extension search (upper right of this page) to locate more recent information.

URL: http:// www.extension.umn.edu/extensionnews/2005/croplandrental.html  This page was updated June 28, 2006 .
Online Privacy Statement.  Contact Information.

University of Minnesota Extension is an equal opportunity educator and employer.
Copyright  ©  Regents of the University of Minnesota.  All rights reserved.