Rocketing Rents

Top average cash rents for irrigated and dryland ground in Nebraska this year surpass last year’s while the top rent for pasture is unchanged. The rise of cash rents headlines the latest estimates of county average rents released by the USDA National Agricultural Statistics Service (NASS). The top rent for irrigated ground exceeds last year’s by $31 per acre, while the highest rent on dryland bests last year’s by $27 per acre. The estimates are based on surveys of farmers and ranchers conducted in the spring. Estimates for a county are not published if there are an insufficient number of responses or the confidentiality of a producer could be compromised.

The maps below detail the cash rent estimates by county for irrigated, dryland, and pasture ground. Northeast Nebraska persists as the locus for the highest cash rates. Wayne and Cedar Counties share the highest rate of $350 per acre on irrigated cropland. Dakota County stakes claim to the highest rate on dryland at $286 per acre. And Wayne County retains the claim on the highest pasture rent for the fifth consecutive year at $88 per acre, off $0.50 from last year.

Cuming and York Counties follow Wayne County for the highest rates on irrigated land with rents of $345 and $326 per acre, respectively. The lowest rent is in Arthur County at $153. The average cash rent across counties is $253 per acre compared to $247 last year. On dryland, Wayne and Cuming Counties rank second and third with rates of $265 and $263 per acre, respectively. The lowest rent is found in Kimball County at $25.50 per acre. The statewide average is $141 per acre compared to $140 last year. Rounding out the top three counties for rents on pasture are Burt County ($75.50 per acre) and Stanton County ($73.50 per acre). The statewide average is $37.60 versus $37 last year. Sioux County has the lowest rate at $10.50 per acre.

FIGURE 1. AVERAGE CASH RENT FOR IRRIGATED LAND, 2023 ($ PER ACRE)

Source: USDA National Agricultural Statistics Service

FIGURE 2. AVERAGE CASH RENT FOR DRYLAND LAND, 2023 ($ PER ACRE)

Source: USDA National Agricultural Statistics Service

FIGURE 3. AVERAGE CASH RENT FOR PASTURE, 2023 ($ PER ACRE)

Source: USDA National Agricultural Statistics Service

Looking back, rental rates in most counties are higher this year compared to 2016. Rates this year on irrigated ground are 12 percent higher on average compared to 2016 with the largest increases occurring in Sherman County (28 percent), Gosper County (27 percent), and York County (24 percent). Not every county has higher rents—four counties have lower rates on irrigated ground today compared to 2016. Cash rents on dryland are 15 percent higher on average with Brown County (124 percent), Box Butte County(51 percent), Lincoln County (44 percent), and Sherman County (44 percent) seeing the greatest growth. Six counties have lower rents today compared to 2016. Finally, rates in 2023 on pasture exceed 2016 levels by 13 percent. Thomas County (76 percent), Kimball County (69 percent), and Howard County (41 percent) saw the largest gains. Rents in 14 counties are lower in 2023 compared to 2016.

Will the increases in rental rates endure? Agricultural economists at the University of Illinois say rents tend to emulate trends in farm returns, but with a one-to-two-year lag. Elevated cash rents this year reflect good farm returns in 2021 and 2022. Farm returns will be lower this year. One would think poorer returns will compress increases in cash rents.