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Cash rent flat for NW Iowa aglandCherokee stable at $340 per acre

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Area farm ground rental rates slightly increased in 2023 due to tightening farm profitability in the corn belt.

The cost to rent farmland in Buena Vista County rose 0.7% to $304 per tillable acre of corn and soybeans, according to an annual cash rent survey by Iowa State University Extension. In Cherokee County, the rental rate rose 0.9% to $340 per acre. In Sac County the rate rose 1.3% to $303 per acre and in Ida County by 6.3% to $313 per acre.

Six of the nine regions in Iowa saw an increase in cash rent rates, with the largest per acre values in northwest and northeast Iowa. These increases were small compared to those in 2023, which surged to produce the highest average value on record, $279 per acre.

The survey also calculated the statewide average rental rate for corn and soybeans remained $279 per acre. This is the first time in five years that the average rate has not increased.

​​Alejandro Plastina, an associate economics professor at Iowa State University and Extension, attributed the relatively flat rental rate to the tight profit margins for farmers growing crops.

“From December 2022 to December of 2023, we’ve seen the rate of return to farmers decline from about 10% to 2%,” Plastina said in a statement that was attached to the survey. “Unless we see an increase in commodity prices, I expect rents will stay the same or decrease.”

The survey also includes information about the inputs needed to grow crops of grain, including costs of nitrogen, local seeds, machinery and labor.

An average Iowa farmer this year can produce conventional corn in a corn-and-soybeans rotation with an average 202 bushel-per-acre corn yield, paying the equivalent cash rent of $285 per acre, plus other required costs. This totals $901.86 per acre, or $4.46 per bushel for corn. The farmer would profit if they can market their corn for more than $4.46 per bushel or beat the average yield.

According to the USDA National Agricultural Statistics Service, the average cash corn price received by Iowa farmers so far this year is $4.55 per bushel.

Iowa grain producers are unlikely to have much disposable income in 2024, and some estimate that in the corn belt, growing grain is likely to be a highly unprofitable undertaking.

Plastina encouraged Iowans and farmers interested in the rental rate discussion or signing a land rent contract to review multiple sources of information, including the unique features of each farm.

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