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Farmland is a vital resource in the United States, serving as the foundation of our agricultural industry.
The cost of farmland varies significantly across different states, influenced by a range of factors such as location, soil quality, and demand for agricultural production.
In this article, we will delve into the average cost per acre of farmland in the United States based on data compiled by AcreTrader and sourced from the USDA.
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This is a sponsored promotion for the AcreTrader platform. Farmland Riches, LLC and it's members may have investments in companies represented on the AcreTrader platform. This informational post is by no means a promotion, solicitation, or recommendation of any specific investment.
Farmland Cost Per Acre
Over the last two decades, the price of farmland in the United States has exhibited a consistent upward trajectory.
According to data from AcreTrader, which relies on information from the United States Department of Agriculture (USDA), the price of farmland per acre has experienced an average annual increase of 4.9% from 1999 to 2019.
This figure does not include returns generated from rental income or crop yield.
As of 2019, the average cost per acre of farmland in the United States stood at $5,586.
Why Farmland Is Increasing In Price
This steady increase in farmland prices can be attributed to several factors.
One significant factor is the growing demand for agricultural products, both domestically and internationally.
As the world's population continues to expand, so does the need for food and other agricultural commodities.
Additionally, farmland often serves as an attractive investment option.
Investors seeking stable returns and a tangible asset often turn to farmland, which can yield profits through crop production, lease agreements, or land appreciation.
Most Expensive Farmland States
As of December 12th, 2021, here are the top 5 most expensive states for farmland per acre:
- New Jersey – $14,020 Per Acre
- California – $10,738 Per Acre
- Arizona – $8,439 Per Acre
- Delaware -$8,414 Per Acre
- Maryland -$7,288 Per Acre
These states stand out as having the highest farmland prices in the country.
The reasons behind their high costs can include factors like proximity to urban centers, favorable climate conditions, and strong demand for agricultural products.
On the flip side, some states offer more affordable farmland options.
Cheapest Farmland States
- Montana – $901 Per Acre
- Nevada – $1,004 Per Acre
- Wyoming – $1,336 Per Acre
- Oklahoma – $1,386 Per Acre
- North Dakota – $1,472 Per Acre
These states feature lower farmland prices, making them attractive for individuals and investors looking for more affordable agricultural opportunities.
The reasons for their lower prices can include factors like remote locations, less favorable soil quality, or lower demand for agricultural production.
The average cost per acre of farmland in the United States has experienced consistent growth over the past two decades, reflecting the increasing demand for agricultural resources and the attractiveness of farmland as an investment.
However, the cost of farmland varies significantly from state to state, with some regions commanding significantly higher prices than others.