The Race Continues: Economic Growth vs. An Economic Tantrum-Week 16

Land Market Summary by Segment:

Crop Land:

Market prices for cash grain crops (corn, soybeans, wheat) have decreased by approximately 50% from 2014. Hence, farmers’ income has been greatly reduced which has ripple effects into crop land prices. In Virginia, our crop land did not skyrocket in price to the same degree as crop land prices in the Mid-west. Mid-west crop land prices are now in decline as are cash rents in the Mid-west with ripple effects impacting agricultural suppliers including equipment manufacturers, etc.

One significant trend that we see in central Virginia is that timber land is being converted into crop land. Often the crops that are going to be grown on this newly created crop land are not the cash grain commodities (corn, soybeans, wheat) but specialty crops.

In these uncertain times, it is critical to remember that land is the source of all wealth. Every product that we humans consume originates with land. Not all tracts of land are equal in quality and portfolio management requires every investor to hold some cash for liquidity. But historically, long term the best investment is land.