In contrast to agricultural land values, which Dan Bigelow wrote about late last year, lease rates in Montana climbed last year. Both grazing leases and crop land lease rates increased from 2020 levels.
Per-acre cash lease rates
The average reported crop land lease rate in Montana was $36 per acre, an increase of $2 from 2020. Irrigated cropland, which has bounced around significantly over time in price, is now at $88 per acre, up from $85 in 2020. Dryland crop leases increased by $1 to $29 per acre. Pastureland rose above $7 per acre in nominal value for the first time since NASS has collected these data. After accounting for inflation, however, these values are relatively steady over time.
Grazing lease rates
Grazing leases rates, which were just published by NASS last month, climbed more than they have in recent history; a full $3 increase per AUM. Cow-calf pair and per head fees each increased by $2 to $28 and $26 per month, respectively.
What is behind these values?
Lease rates are a function of many things. One of those things, unsurprisingly, is the estimate of the productive value of the land. Crop prices climbed throughout 2021; cattle prices increased but were a bit more steady. The drought affected both crop and livestock markets in big ways, likely pushing up the value of irrigated land and the relative reduction in drought risk irrigation provides. Both grazing land as well as hay were pricey and scarce last year because of the drought, likely playing a role in the increased value of that forage in terms of grazing.
To find out more information about these statistics and how they are collected, you can check out this page for the per-acre cash lease rates, and this page for grazing fees. For more information on Montana leases, see https://aglease.msuextension.org/.