Eastern IA Farmer_Fall23_SOUTH

Ag Bytes
where she specializes in executive-level
searches for the agribusiness industry.
Also speaking is Kiley Fleming, the executive
director of Iowa Mediation Services,
who released her book “Conflict Imagery”
earlier this year.
Other topics to be addressed include
farmland management, making the most
of your leadership style, entrepreneurship,
personal finance and lifestyle balance. A
panel of current Iowa agricultural board
leaders will share insights on leading and
being influences in agriculture. Some of
the tour highlights include the new Veterinary
Medicine Diagnostics Laboratory and
campus greenhouses.
Also on tap is the celebration of the
20th anniversary of Annie’s Project, from
which the conference developed.
More land leased; less than
half of farmland owners farm
As the average age of Iowa’s farmland
owners continues to rise, other trends in
landownership have begun to emerge.
According to an Iowa State University
study, 58% of Iowa’s farmland is now
leased out, a significant increase from the
last time the same study was conducted
in 2017.
“There is a long-term trend toward farmland
leasing since 1982,” said Wendong
Zhang. Zhang is an assistant professor of
economics at Cornell University and conducted
the Iowa Farmland Ownership and
Tenure Survey with Jingyi Tong, a PhD
student in economics at Iowa State.
“The percentage of farmland being
leased in Iowa increased from 53% in
2017 to 58% in 2022. This represents a
relative increase of roughly one million
acres over five years, which is quite significant,”
Zhang said.
Conducted by Iowa State since the
1940s, the Iowa Farmland Ownership and
Tenure Survey – completed every five
years – focuses on forms of ownership,
tenancy and transfer of farmland in Iowa,
and characteristics of landowners.
The latest survey was conducted in July
2022, and was funded by Iowa State’s
College of Agriculture and Life Sciences,
Iowa Nutrient Research Center, Leopold
Center for Sustainable Agriculture, Department
of Economics, Center for Agricultural
and Rural Development and Iowa
State University Extension and Outreach.
Farmland leases also increasingly favor
cash rent over crop sharing and owner-operating
arrangements. In 2017, 82%
Wendong Zhang,
Assistant Professor
of economics,
Cornell University
of leased farmland
was cash rented,
but cash rent,
predominantly
fixed-cash rental
contracts, now
account for 87% of
leased land.
“The rise of cash
rent, especially
fixed cash rent,
correlates with the
growing percentage
of landowners
who are part-time
and non-residents
of Iowa,” Zhang
said. “Fifty-five
percent of land is owned by an owner who
did not farm in 2022, and, of them, over
half do not have farming experience. Especially
for those landowners, a fixed cash
rental contract is a natural choice.”
According to the study, 47% of farmland
was directly operated by the landowner in
2017, but that number has now fallen to
just 42%.
The survey found that the average age
of Iowa’s farmland owners is still increasing.
In 1982, only 29% of Iowa farmland
was owned by those over the age of 65.
That percentage has steadily increased
over the years, totaling 60% in 2017 and
66% today. Tong noted that women own
46% of Iowa’s farmland, and they hold a
larger share among senior owners.
Tong said several factors are contributing
to the increasing age of Iowa’s
farmland owners, including the increase
in using farmland as an inheritance or
long-term investment, fewer young people
going into farming, and those young farmers
facing large start-up costs.
“Also, some senior farmers may retain
ownership of their land due to a lack of
succession planning, thus keeping the
farm even if they aren’t actively farming.
The survey shows 17% of landowners
neither have a successor for ownership or
management,” Tong said.
However, Tong noted that survey results
show three of every four landowners
in Iowa are interested in selling land to
beginning farmers when incentivized with
federal and state tax credits.
“At the same time, over half of Iowa
landowners expressed concerns about
difficulty finding quality beginning farmers
as well as beginning farmers’ ability to pay
the best prices for land,” Tong said.
The recent survey also reveals changing
trends in how ownership of Iowa’s
farmland is held. In
1982, 80% of Iowa’s
farmland was
owned through
a combination of
sole ownership
and joint tenancy;
however, those
now only account
for 52% of Iowa
farmland ownership.
Meanwhile,
the amount of
farmland held in
Jingyi Tong, trusts has skyrocketed
from 1%
PhD economic student
at Iowa State University in 1982 to 23%
today.
“Trusts have grown in popularity due to
their numerous benefits. Particularly for
farmland owners, trusts can ensure the
preservation of the farm within the family,
manage land transitions, and potentially
provide tax benefits, making them a valuable
tool in succession planning,” Zhang
said.
The percentage of farmland owned
debt-free has also continued to increase –
84% of Iowa farmland is held without any
debt, the highest level observed. This represents
a steady and significant increase
from 1982, a year that marked the onset
of the farm debt crisis, when only 62% of
the land was held without debt. Tong said
that some of that recent increase is due
to the hike in commodity profits, aging
landowners coupled with longer lengths
of ownership, and government payments
during the COVID-19 pandemic.
Zhang said that the survey also found
interesting trends in the use of conservation
techniques on Iowa farmland. He
noted that no-till farming saw a significant
increase from 21% of owners and 27% of
acres in 2017 to 29% and 30%, respectively,
in 2022.
“The use of cover crops also saw a
slight increase over this period, from 5%
of owners and 4% of acres in 2017 to 7%
for both owners and acres in 2022,” he
said.
However, only 2% of Iowa landowners
have already participated in a carbon
credit program and another 3% are considering
doing so, but, Zhang said, “most
landowners are either not interested or
have never heard of them.”
More information about the 2022 Iowa
Farmland Ownership and Tenure Survey
results can be found on the CARD website
at card.iastate.edu/.
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