What is in this article?:
- Arizona farmland values and rental rates continue to increase due to higher commodity prices.
- One of the best examples of economic recovery in Arizona agriculture is increasing farmland values in Pinal County.
- Farmland rental rates have increased about 50 percent in Arizona's Maricopa and Pinal counties.
In Yuma County’s North and South Gila Valleys, land values range from $25,000 to $31,500 per acre. Rents are in the $600 to $850 per acre range; all headed higher.
In the county’s eastern Wellton-Mohawk Irrigation District, lower Yuma Valley and the Indian Unit of the Bard Valley (Imperial County), rents are increasing following several years of decline. On the Indian unit, several farm blocks available for lease were put up for auction.
“Owners asked for about $700 and the bidders bid it up to about $800 per acre,” Moody said.
The Indian Unit in 2009 included about 2,000 acres of produce ground where tenants did not renew leases.
“What a reversal,” Moody said. “I anticipate rental rates in these areas will continue to trend upward modestly if commodity prices remain profitable.”
In Imperial County, Myron Fortin, senior appraiser, Farm Credit Services Southwest (FCSSW), El Centro, says farmland sales more than doubled from 2010 to 2011.
Land values at the bottom quality end range from $3,000 to $4,000 per acre. Upper end sales range from $9,000 to $10,000/acre. Rental rates totaled $175 to $300 per acre. Most buyers are local. Several large hedge fund groups bought larger blocks of ground.
Broker-appraiser Mark Finley of Finley Appraisal Services in Willcox marched to the ASFMRA speaker’s podium with a spring in his step with good news about farmland values in southeastern Arizona.
“I am very, very pleased to stand up here and be positive for a change,” Finley said. “We in Cochise County have moved forward. With the coming of 2011, land values began to rise and commodity prices rose. We have had several good sales of mostly good-quality farms.”
Rents are also on the rise. Crops grown in southeastern Arizona include alfalfa, fruit, vegetables, wine grapes, cotton, and other crops.
“For a change I can be a broker instead of an appraiser,” Finley quipped. “It’s been a long dry spell, folks.”
For a perspective on the Arizona dairy industry, Tempe-based FCSSW appraiser Tom Van Hofwegen says Arizona is still considered a desirable state for dairying.
Van Hofwegen’s dairy outlook is “profitable but cautious.” The ongoing concerns among dairymen are higher prices for fuel and alfalfa hay for feed.
He says ongoing discussions continue over the possible implementation of supply management-based policies to address large swings in U.S. milk prices. Van Hofwegen does not believe a supply-management program will be enacted.