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South Central Iowa | I think he meant to say that you could pay more rent if you weren't paying insurance premium and just miswrote it. Farmer saves $20 on something and he bids up his neighbors rent by $20 sort of thing.
Insurance raises the land price by making the worst years the best years. Also provides a degree of price support. So I agree with you that it raises and sustains values more than that aforementioned alternative.
It would be interesting to see the percentage of land value that could be attributed to government support programs. CRP and Crop Insurance still, but the DCP and CCP payments of old still had an impact 10 years ago and the market retains it. Also the impact of the monetary policy over the past decade that is changing slowly now.
Wild Guess: Base acres and the old DCP/CCP is 3% still, CRP is 5% of land value, Crop Insurance 7%, Monetary Policy is 15%, and Ethanol/Trade Policy is 30%... More in the places like NW Iowa... I think government policy over the past 20 years is responsible for 60% or so of land values.
The Crutch and The Cudgel | |
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New Farm Bill
