DES MOINES — Iowa farmland values fell by nearly 3 percent over the past year, in part because of President Donald Trump's trade disputes with China and other countries, according to a new report.
The Iowa Chapter of the Realtors Land Institute found that the 2.7 percent decline occurred despite the federal government's trade bailout program for farmers hurt by foreign retaliation against Trump's tariffs, as well as limited land and higher yields in some parts of Iowa.
The average farmland value statewide was nearly $6,800 an acre (0.4 hectare), the Des Moines Register reported.
Trade wars with Canada, China, Mexico and other countries tugged on Iowa's farmland values, especially last fall, as did tightening cash for operations and higher interest rates, according to the group of farmland managers, brokers, appraisers and other industry workers.
With lower economic returns from farming, buying agricultural land becomes less attractive, which can reduce its value.
"The tariffs last fall really pushed a lot of values," said Kyle Hansen, a broker with Hertz Real Estate Services in Nevada. "There were a lot of negative attitudes, a lot of negative thoughts," particularly considering a slow, rain-drenched harvest in parts of Iowa.
Farmland values in north-central Iowa had the most drastic decline at 2.8 percent over the past six months, while southeast Iowa's values grew by 3 percent.
Hansen said the trade agreement with Canada and Mexico that's pending in Congress gives the industry confidence that a deal can be reached with China. But he said that entering the summer months without a new trade agreement will concern farmers that commodity prices could be pulled even lower.