Land values up across Wyoming
Local rancher, assessor say out-of-state money pushing up demand for ag land
BUFFALO — In rancher Dave Belus' eyes, rising prices for agricultural land in Johnson County and across Wyoming are making it increasingly difficult for young producers to get into the ranching and farming business without the help of family ties to agriculture.
“There is no doubt that real estate is going up,” Belus said, while cutting hay for the Belus Brothers Ranch that he operates in Johnson County. “There are a lot of people who would love to own their own land, but it's extremely hard for young producers to do that. … I don't want to paint a picture of gloom. As some producers get older and want to slow down, there may be an opportunity for younger people to lease their property.”
In August the National Agricultural Statistics Service, or NASS, released the latest survey data on farmland real estate values and cash rent prices for irrigated, nonirrigated and pasture land in Wyoming.
In 2023 the average farmland real estate value, which is a measurement of all land and buildings on farms, was $880 per acre. That's an increase of 3.5% from 2022 and 11.4% from 2021, according to NASS.
The highest-priced land in Wyoming is irrigated cropland, at an average price of $3,000 per acre, up 9.1% from the previous year, while non-irrigated cropland was valued at $960, up 2.1% from the previous year.
Pasture values were at $670 per acre, up 1.5% from 2022.
Average cash rents were generally stable for irrigated, nonirrigated and pasture land, according to the NASS data. Irrigated cropland is renting for $86.50 per acre, non irrigated cropland for $20 per acre and pasture for $5.90 per acre.
In Johnson County, NASS surveys indicated that pasture land is renting for $5 per acre in 2023. That's the highest rental price for pasture land in Johnson County that NASS has recorded since it started digitizing its data collection in 2009.
Across the United States, NASS estimates the average value of farmland to be $4,080 per acre, for an average increase of 6.7%.
The average value of cropland has increased significantly across the nation since 2009, when the average price per acre was $2,640 to nearly $5,460 today.
While cropland values are rising quickly throughout the U.S., that's not the case with pastureland in Western states because of the significant portion of land owned by the federal government and leased out to ranchers.
Some of the states with the biggest increases border Wyoming, such as South Dakota and Nebraska, which both saw double digit percent increases in farmland value from 2022 to 2023, according to NASS.
“In the values, it looks like we are seeing pretty consistent increases from state to state,” said Rodger Ott, the director of the Colorado field office of NASS, which also evaluates farmland values in Colorado, Arizona, Montana, New Mexico and Utah. “They are all going up on a pretty comparable value, especially farmland real estate.”
Ott, as well as Belus and local appraiser Theo Hirshfeld, said that figures can change from year to year based on the survey data that the service receives. Wyoming is a non disclosure state, meaning that farmland real estate values are not public information. That means NASS has to rely on farmers and ranchers to report reliable information.
For example, while the NASS figure for the increase in farmland real estate values from 2022 to 2023 in Wyoming is 3.5%, Hirshfeld, a certified general appraiser for TBH Appraisal Co. in Buffalo with nearly three decades of experience, said that he thinks the increase is closer to 12%.
In particular, Hirshfeld said that big purchases of land in Johnson County by out-of-staters with significant wealth have pushed up agricultural land prices through the simple play of supply and demand.
“Farmland and ranchland is getting in short supply, because moneyed people are coming out and buying a lot of acreage,” he said. “Some of these people are interested in agriculture, but the vast majority are just looking for a place to invest their money. … They can come out here and put on their cowboy boots and then go back to the big city and say, 'I was on the ranch this weekend.'"
Hirshfeld and Belus said that, as the amount of available agricultural land decreases, price increases in land values and rents are natural.
Belus said that the big purchasers of land are “buying it for tax purposes, or hunting and recreation.”
He said that local farmers and ranchers will always support local businesses, but he was less sure that big land owners from out of state would do so.
"You've got these struggling cowboys who have been leasing, and they're unable to buy the land," Hirshfeld said. "It's a major change.”
As for more local trends in Johnson County, Hirshfeld said that land on the western side of the county closer to the mountains typically sells for higher prices. He said that the bigger jumps in agricultural prices began after the COVID-19 pandemic, when he saw more people attempting to escape big cities and purchase large parcels of land in Johnson County, and across Wyoming.
Belus said that rising interest rates were also making it more difficult for younger producers to buy land and get into the business. He said that while a few years ago a farmer or rancher interested in buying land might be able to secure a sub-3% interest rate, that's not possible anymore as the Federal Reserve pumps up rates to slow inflation.
He also said that all pasture land is not made equal, and cash rent prices for pasture could and should vary widely based on how many AUMs, or animal unit months, that a certain pasture land could support.
“That said, we are getting record prices on our crops and cattle," he said. "But I don't think it's going to justify those land prices.”
This story was published on September 21, 2023.