When the World Shakes, Money Moves—And Sometimes It Moves Toward Farmland

Trade wars, 5% daily swings in the stock market, and no clear relief in sight—that’s been the landscape these past few months as the new administration works its plan.

And yet, based on what we’re seeing at the auction block, none of it has dampened interest in farmland. If anything, it’s pushed more money toward it.

As an example, we recently sold 235 acres in three tracts. Normally, we’d see 15 to 35 registered bidders on a land auction of this size. This time? Seventy-two. Another recent auction of 80 acres of CRP ground we held brought in 35 registered bidders. Demand for land of all qualities has been solid, even well into planting season.

Farmland isn’t gold, but investors see it in a similar way. It’s a long-term, hard asset that’s simple, steady, and resilient. It weathers storms and delivers a decent return. And it really is that simple: buy the land, rent it to a good farmer or rancher, collect a check once a year, and go admire it whenever you feel like it. Over time, as the global population grows, the need for productive acres to grow whatever crop America wants isn’t going anywhere. It’s a safe bet.

The equity markets? Not so much. With daily swings you can see and feel, and policies that can make or break a business with the stroke of a pen, it’s no surprise some investors are uneasy and looking for alternatives. If you're 70 years old and sitting on strong stock gains, farmland has probably looked more appealing in recent years. I think that trend will continue.

Information plays a big role in this shift. For years, farmland investing was hard to understand for folks outside agriculture. Just like stocks can feel unfamiliar to farmers. But that gap is closing. Technology has made it easier to evaluate land quality, value, and location. Data on sales, soil ratings, and comparable land is easier to find than ever. Smart, well-capitalized people are paying attention and getting involved.

To this point, we just sold a property to a young investor who had never set foot on the tract—and it was their first land purchase. I expect more of this in the future

Still, our largest bidder group remains farmers. Roughly 60% of our registered bidders intend to farm the land themselves, usually neighbors. And about 85% of the time, they end up with the winning bid. That tells you something. But as farmland markets become more transparent, interest from outside buyers will only grow. Especially in uncertain times like these, when there are a lot of questions about how we’ll trade goods and services as a nation moving forward.

 

See the full article from Dakota Farmer here!