Farmland values have begun to soften slightly in most parts of the United States, says Murray Wise, chief executive officer, Westchester Group, one of the leading agricultural asset managers in the United States. “We’ve seen land values fall 6% to 12% in value and expect to see them continue a modest decline through 2009, resulting in an overall loss in value of 12% to 15%,” says Wise. Speaking at the Bayer Crop Science 2009 Ag Issue Forum, held prior to Commodity Classic, Wise predicted that demand for land will continue. The poor rate of return for investments in other sectors of the economy will prompt more money to be invested in land, where returns have held their own. Wise, whose company controls enough California land to make it the third-largest producer of almonds in the world, is seeing water become a defining commodity. Offers to buy water in California is bordering on values that exceed the value of the crop, Wise notes.
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