Nebraska Land Values & Cash Rental Rates 2020-2021

1 Nebraska Land Values &Cash Rental Rates 2020-2021 Preliminary EstimatesJim JansenAgricultural StokesProfessor in Land Values and Rental Rates shown and discussed in this presentation are preliminary estimates from the UNL Nebraska farm Real Estate Market Survey. Information provided in this presentation are averages from these surveys. Actual land Values and Rental Rates may vary depending upon the quality of the parcel and local market forces for an area. Nebraska farm Real Estate Survey Annual survey conducted since 1978 of Nebraska agricultural appraisers, professional farm managers, and bankers engaged in the land industry. Preliminary results for land Values and Rental Rates published the second week of March.

2 Full report published in June. Nebraska farm Real Estate website full access to these resources: Agricultural Statistics DistrictsNebraska Land ValuesLand Averages and Annual Percent ChangesNebraska Agricultural Average All Land Value Feb. 1, 2021 North$1,160/ac6%Northwest$715/ac4%Southw est$1,600/ac3%Central$3,395/ac7%Northeas t$5,755/ac7%East$6,850/ac5%Southeast$5,2 30/ac8%South$3,805/ac5%State$2,895/ac6%S ource: Nebraska farm Real Estate Market Development Survey, Estimates Nebraska Average Land Value,1979-2021 Dryland Cropland (No Irrigation Potential)Average Value Feb. 1, 2021 North$1,650/ac9%Northwest$635/ac4%Southw est$1,440/ac2%Central$3,080/ac8%Northeas t$5,765/ac5%East$6,485/ac6%Southeast$4,9 35/ac11%South$3,070/ac3%State$3,380/ac7% Source: Nebraska farm Real Estate Market Development Survey, Estimates Dryland Cropland (Irrigation Potential)Average Value Feb.

3 1, 2021 North$2,115/ac7%Northwest$760/ac9%Southw est$1,620/ac5%Central$3,575/ac11%Northea st$6,200/ac8%East$6,835/ac4%Southeast$5, 655/ac6%South$3,605/ac3%State$4,390/ac6% Source: Nebraska farm Real Estate Market Development Survey, Estimates Grazing Land (Tillable)Average Value Feb. 1, 2021 North$1,180/ac7%Northwest$540/ac4%Southw est$950/ac3%Central$1,965/ac5%Northeast$ 3,245/ac1%East$3,380/ac6%Southeast$2,985 /ac2%South$1,990/ac8%State$1,300/ac5%Sou rce: Nebraska farm Real Estate Market Development Survey, Estimates Grazing Land (Nontillable)Average Value Feb. 1, 2021 North$690/ac5%Northwest$445/ac3%Southwes t$755/ac1%Central$1,490/ac2%Northeast$2, 120/ac4%East$2,575/ac7%Southeast$2,135/a c4%South$1,465/ac6%State$860/ac4%Source: Nebraska farm Real Estate Market Development Survey, 2021.

4 Preliminary Estimates HaylandAverage Value Feb. 1, 2021 North$1,200/ac3%Northwest$775/ac8%Southw est$1,310/ac2%Central$1,980/ac3%Northeas t$3,230/ac5%East$3,070/ac4%Southeast$2,8 00/ac3%South$1,925/ac1%State$1,695/ac3%S ource: Nebraska farm Real Estate Market Development Survey, Estimates Gravity Irrigated CroplandAverage Value Feb. 1, 2021 North$3,790/ac4%Northwest$2,245/ac5%Sout hwest$3,775/ac6%Central$6,180/ac6%Northe ast$7,325/ac9%East$8,110/ac5%Southeast$6 ,710/ac8%South$5,735/ac5%State$6,095/ac6 %Source: Nebraska farm Real Estate Market Development Survey, Estimates Center Pivot Irrigated CroplandAverage Value Feb. 1, 2021 North$4,285/ac8%Northwest$2,560/ac4%Sout hwest$4,170/ac5%Central$7,270/ac9%Northe ast$8,145/ac10%East$9,545/ac7%Southeast$ 8,380/ac9%South$6,885/ac6%State$6,610/ac 8%Source: Nebraska farm Real Estate Market Development Survey, Estimates Rating of Factors Influencing Agricultural Land Values in 2020 Source: Nebraska farm Real Estate Market Development Survey, Cash Rental RatesDryland Cropland Rental RatesDryland CroplandAverage Rental Rates 2021 SeasonNorth$57/ac11%Northwest$30/ac9%Sou thwest$42/ac12%Central$98/ac8%Northeast$ 225/ac5%East$220/ac7%Southeast$170/ac3%S outh$83/ac10%Source.

5 Nebraska farm Real Estate Market Development Survey, Estimates Dryland Cropland Rental Rate Ranges 2021 SeasonNorthH: $91/acA: $57/acL: $47/acNorthwestH: $42/acA: $30/acL: $24/acSouthwestH: $54/acA: $42/acL: $35/acCentralH: $120/acA: $98/acL: $89/acNortheastH: $265/acA: $225/acL: $180/acEastH: $240/acA: $220/acL: $175/ac By RegionHigh Grade (H)Average (A)Low Grade (L)SouthH: $120/acA: $83/acL: $57/acSoutheastH: $195/acA: $170/acL: $135/acSource: Nebraska farm Real Estate Market Development Survey, 2021. Preliminary Estimates USDA-National Agricultural Statistics Service Cash Rent Survey Biennial survey conducted by the USDA-National Agricultural Statistics Service (NASS) of farmers and ranchers Survey starts in late-winter and conducted through mid-summer of odd-numbered years (some even-number yeas as well) Analysis published around the second week of September Nebraska county estimates in addition to other resources may be found at: Cropland Rental Rates 2020 SeasonSource.

6 Farmland Rental Rate Survey, USDA-NASS, August 28, 2020 Nebraska Cash Rental RatesIrrigated Cropland Rental RatesGravity Irrigated CroplandAverage Rental Rates 2021 SeasonNorth$180/ac6%Northwest$115/ac10%S outhwest$170/ac6%Central$215/ac5%Northea st$280/ac8%East$260/ac2%Southeast$240/ac 4%South$210/ac2%Source: Nebraska farm Real Estate Market Development Survey, EstimatesGravity Irrigated CroplandRental Rate Ranges 2021 SeasonNorthH: $210/acA: $180/acL: $140/acNorthwestH: $145/acA: $115/acL: $90/acSouthwestH: $195/acA: $170/acL: $140/acCentralH: $255/acA: $215/acL: $175/acNortheastH: $320/acA: $280/acL: $225/acEastH: $280/acA: $260/acL: $230/ac By RegionHigh Grade (H)Average (A)Low Grade (L)SouthH: $245/acA: $210/acL: $175/acSoutheastH: $285/acA: $240/acL: $210/acSource: Nebraska farm Real Estate Market Development Survey, 2021.

7 Preliminary Estimates Center Pivot Irrigated CroplandAverage Rental Rates 2021 SeasonNorth$210/ac8%Northwest$150/ac7%So uthwest$195/ac5%Central$235/ac2%Northeas t$305/ac5%East$290/ac4%Southeast$280/ac6 %South$235/ac7%Source: Nebraska farm Real Estate Market Development Survey, EstimatesCenter Pivot Irrigated CroplandRental Rate Ranges 2021 SeasonNorthH: $255/acA: $210/acL: $180/acNorthwestH: $170/acA: $150/acL: $130/acSouthwestH: $235/acA: $195/acL: $165/acCentralH: $270/acA: $235/acL: $190/acNortheastH: $340/acA: $305/acL: $260/acEastH: $330/acA: $290/acL: $250/ac By RegionHigh (H)Average (A)Low (L)SouthH: $265/acA: $235/acL: $190/acSoutheastH: $310/acA: $280/acL: $240/acSource: Nebraska farm Real Estate Market Development Survey, 2021.

8 Preliminary Estimates Irrigated Cropland Rental Rates 2020 SeasonSource: Farmland Rental Rate Survey, USDA-NASS, August 28, 2020 Nebraska Cash Rental RatesPasture and Cow-Calf Pairs Rental RatesPasture per AcreAverage Rental Rates 2021 SeasonNorth$28/ac8%Northwest$13/ac10%Sou thwest$22/ac7%Central$37/ac6%Northeast$6 6/ac4%East$53/ac3%Southeast$49/ac1%South $38/ac4%Source: Nebraska farm Real Estate Market Development Survey, EstimatePasture per AcreRental Rate Ranges 2021 SeasonNorthH: $41/acA: $28/acL: $15/acNorthwestH: $18/acA: $13/acL: $11/acSouthwestH: $30/acA: $22/acL: $16/acCentralH: $45/acA: $37/acL: $32/acNortheastH: $84/acA: $66/acL: $49/acEastH: $72/acA: $53/acL: $40/ac By RegionHigh Grade (H)Average (A)Low Grade (L)SouthH: $46/acA: $38/acL: $28/acSoutheastH: $59/acA: $49/acL: $40/acSource: Nebraska farm Real Estate Market Development Survey, 2021.

9 Preliminary Estimates Pasture per AcreRental Rates 2020 SeasonSource: Farmland Rental Rate Survey, USDA-NASS, August 28, 2020 Cow-Calf PairsAverage Rental Rates 2021 MonthlyNorth$ $ $ $ $ $ $ $ : Nebraska farm Real Estate Market Development Survey, EstimatesCow-Calf Pairs Rental Rate Ranges 2021 MonthlyNorthH: $ A: $ L: $ : $ : $ : $ : $ : $ : $ : $ : $ : $ : $ : $ : $ : $ : $ : $ RegionHigh Grade (H)Average (A)Low Grade (L)SouthH: $ : $ : $ : $ : $ : $ : Nebraska farm Real Estate Market Development Survey, 2021. Preliminary Estimates Agricultural Land LeasesTrends in Lease Arrangements for 2021 Methods for Setting Cash Rental Rates Methods for estimating a cash Rental rate in 2021: Adjusting survey data Cash equivalent from crop share Return on investmentEstimating Cash Rental Rates by Adjusting Survey Data Land Rental rate survey data: Evaluate available cash Rental survey data to establish a baseline in the landlord and tenant negotiation process.

10 Average yields:CountyValueFarmValueCounty Rental Rate$135 Rent/Bushel$ Yield120 Yieldx 105 Rent/Bushel$ Level Rent$ - March 2020 Corn - July 2020 Corn - Nov. 2020 Yield (50% share)80 $ $ $ $280/ac.$248/ac.$312 Expenses-$155 $155 $155 Return to Owner (Effective Rent)$125/ac.$93/ac.$157 Equivalent From Crop Share Rent paid to landlord by tenant based off owner s share of net returns per acre. Example 50/50 split:Value33:67 Hayland Share50:50 Hayland ShareYield (share) $80/tonx $80/tonIncome$66/ac.$100 Expenses*-$0 $10 Return to Owner (Effective Rent)$66/ac.$90 Equivalent From Hay Share Rent paid to landlord by tenant based off owner s share of net returns per acre.