Increase is third highest in past two decades.
A study conducted by South Dakota State University (SDSU) shows agricultural land values are booming again in South Dakota, charting a 16.5% increase in 2010-2011, the third-largest since SDSU economists began tracking the farm real estate market in 1991.
High commodity prices were the main factor driving the land market, according to a majority of those surveyed.
However, SDSU economists note that the current average rates of cash return on agricultural land in South Dakota were lower in 2010 and in 2011 than in any of the past 21 years. For 2011, the average ratio of gross cash rent to current land value was 3.9% for all agricultural land, 4.3% for non-irrigated cropland, and 3.6% for rangeland. During the 1990s, the same ratios were 7.4% for all agricultural land, 8.0% for cropland, and 6.8% for rangeland.
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