| Dust88 - 2/10/2026 12:51
I think it's a leftover idea from the 90s and early 2000s that the first few years of a farm mortgage will be rough, but halfway through you'll start making money and the last leg of the mortgage will be easy. They're all going to be rough. Land that is being bought for $20k an acre in my county that yields 210bu corn is not going to cash flow in the next 20 years. We would have to have $10+ corn to break even right now with conventional financing. Do you see that happening to corn, and/or inputs drastically decreasing going forward? I personally don't.
If land continues to appreciate and is worth $50k an acre in 2040 things will be beautiful on paper. I have no idea who will be buying $50k ground to raise $4 corn on but I'm sure some will try. I believe that is an excellent synopsis of the situation at hand. Well done. Ive made a mathemacal calculation to at least come up with some semblance of a baseline for cropland "economic equilibrium", as a price per acre that kinda makes sense. Every penny above that number is betting on the come, but at least provides an individual an idea where they stand when contemplating a new purchase. The formula looks like this; Take the average going cash rent rate for the area times 140%, then take that number times 20 years. That'll give you your nut.
Edited by Boone & Crockett 2/12/2026 16:19
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Rental Income Breakdown and K Shaped Economy
