IDEAS home Printed from https://ideas.repec.org/a/bla/canjag/v69y2021i2p291-298.html
   My bibliography  Save this article

COVID‐19 and Canadian farmland markets in 2020

Author

Listed:
  • Chad Lawley

Abstract

Early evidence suggests that Canadian farmland values increased in 2020. Farming returns were not negatively impacted by COVID‐19 and it appears as though farming returns will be strong into 2021. Low interest rates in 2020 contributed to substantial farmland value increases in the last half of 2020. There is some evidence that the development component of farmland values increased in 2020. The future consequences of COVID‐19 on farmland values are unclear. Some economists suggest that future inflationary risks have increased. A return to inflation rates comparable to those experienced in the 1970s is unlikely, but if increased inflation does materialize it will put upward pressure on farmland values, while increases in nominal and real interest rates will push farmland values down. Les informations disponibles, à ce jour, suggèrent que la valeur des terres agricoles canadiennes a augmenté en 2020. Les rendements agricoles n'ont pas été négativement touchés par la COVID‐19 et il semble que les rendements agricoles seront solides en 2021. Les faibles taux d'intérêt en 2020 ont contribué à des augmentations substantielles de la valeur des terres agricoles au cours du dernier semestre de 2020. Certains éléments indiquent que la composante développement des valeurs des terres agricoles a augmenté en 2020. Les conséquences futures du COVID‐19 sur les valeurs des terres agricoles ne sont pas claires. Certains économistes suggèrent que les risques inflationnistes futurs se sont accrus. Un retour à des taux d'inflation comparables à ceux enregistrés dans les années 1970 est peu probable, mais si une inflation accrue se matérialise, elle exercera une pression à la hausse sur la valeur des terres agricoles, tandis qu'une augmentation des taux d'intérêt nominaux et réels va créer une pression baissière sur la valeur des terres agricoles.

Suggested Citation

  • Chad Lawley, 2021. "COVID‐19 and Canadian farmland markets in 2020," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 69(2), pages 291-298, June.
    • Handle: RePEc:bla:canjag:v:69:y:2021:i:2:p:291-298
    DOI: 10.1111/cjag.12283
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/cjag.12283
    Download Restriction: no
    File URL: https://libkey.io/10.1111/cjag.12283?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Wendong Zhang & Cynthia J. Nickerson, 2015. "Housing Market Bust and Farmland Values: Identifying the Changing Influence of Proximity to Urban Centers," Land Economics, University of Wisconsin Press, vol. 91(4), pages 605-626.
    2. Richard E. Just & John A. Miranowski, 1993. "Understanding Farmland Price Changes," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 75(1), pages 156-168.
    3. Lawley, Chad & Yang, Wanhong, 2015. "Spatial interactions in habitat conservation: Evidence from prairie pothole easements," Journal of Environmental Economics and Management, Elsevier, vol. 71(C), pages 71-89.
    4. Daniel P. McMillen, 2012. "Repeat Sales as a Matching Estimator," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 40(4), pages 743-771, December.
    5. Colin A. Carter & Richard S. Gray & W. H. Furtan, 1990. "Exchange Rate Effects on Inputs and Outputs in Canadian Agriculture," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 72(3), pages 738-743.
    6. Wendong Zhang, 2020. "2020 Iowa State University Land Value Survey: Overview," Center for Agricultural and Rural Development (CARD) Publications 20-wp613, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    7. Chad Lawley, 2014. "Changes in Implicit Prices of Prairie Pothole Habitat," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 62(2), pages 171-190, June.
    8. Raup, Philip M., 1989. "Some Lessons From Land Price Booms And Busts," Staff Papers 14179, University of Minnesota, Department of Applied Economics.
    9. Chad Lawley, 2020. "Potential impacts of COVID‐19 on Canadian farmland markets," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 68(2), pages 245-250, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Alan P. Ker & Ryan Cardwell, 2021. "Introduction to the special issue on COVID‐19 and the Canadian agriculture and food sectors: Thoughts one year into the pandemic," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 69(2), pages 155-159, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Albulena Basha & Wendong Zhang & Chad Hart, 2021. "The impacts of interest rate changes on US Midwest farmland values," Agricultural Finance Review, Emerald Group Publishing Limited, vol. 81(5), pages 746-766, February.
    2. B. James Deaton & Chad Lawley, 2022. "A survey of literature examining farmland prices: A Canadian focus," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 70(2), pages 95-121, June.
    3. Lawley, Chad & Yang, Wanhong, 2015. "Spatial interactions in habitat conservation: Evidence from prairie pothole easements," Journal of Environmental Economics and Management, Elsevier, vol. 71(C), pages 71-89.
    4. Chad Lawley, 2020. "Potential impacts of COVID‐19 on Canadian farmland markets," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 68(2), pages 245-250, June.
    5. Ritter, Matthias & Hüttel, Silke & Odening, Martin & Seifert, Stefan, 2020. "Revisiting the relationship between land price and parcel size in agriculture," Land Use Policy, Elsevier, vol. 97(C).
    6. Waltl, Sofie R., 2018. "Estimating quantile-specific rental yields for residential housing in Sydney," Regional Science and Urban Economics, Elsevier, vol. 68(C), pages 204-225.
    7. Gaurav Arora & Peter T. Wolter & Hongli Feng & David A. Hennessy, 2016. "Role of Ethanol Plants in Dakotas Land Use Change: Incorporating Flexible Trends in the Difference-in-Difference Framework with Remotely-Sensed Data," Center for Agricultural and Rural Development (CARD) Publications 16-wp564, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    8. Lautrup, M. & Panduro, T.E. & Olsen, J.V. & Pedersen, M.F. & Jacobsen, J.B., 2023. "Is there more to trees than timber? Estimating the private amenity value of forests using a hedonic land model for combined agricultural properties," Forest Policy and Economics, Elsevier, vol. 146(C).
    9. Carlberg, Jared G., 2002. "Effects Of Ownership Restrictions On Farmland Values In Saskatchewan," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 34(2), pages 1-10, August.
    10. Buchholz, Matthias & Danne, Michael & Musshoff, Oliver, 2022. "An experimental analysis of German farmers’ decisions to buy or rent farmland," Land Use Policy, Elsevier, vol. 120(C).
    11. Gardner, Bruce L., 2002. "U.S. Commodity Policies And Land Prices," Working Papers 28560, University of Maryland, Department of Agricultural and Resource Economics.
    12. Kvartiuk, Vasyl & Herzfeld, Thomas, 2019. "Welfare effects of land market liberalization scenarios in Ukraine: Evidence-based economic perspective," IAMO Discussion Papers 186, Leibniz Institute of Agricultural Development in Transition Economies (IAMO).
    13. Wang, Haoluan, 2017. "Land Conservation for Open Space: The Impact of Neighbors and the Natural Environment," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258125, Agricultural and Applied Economics Association.
    14. Miller, Cristina & Nikaj, Silda & Pender, John, 2015. "Impacts of Hospital Closures on Rural Housing Values in Illinois," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205546, Agricultural and Applied Economics Association.
    15. Titus O. Awokuse & Joshua M. Duke, 2006. "The Causal Structure of Land Price Determinants," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 54(2), pages 227-245, June.
    16. Li, Xin, 2016. "The Farmland Valuation Revisited," International Journal of Food and Agricultural Economics (IJFAEC), Alanya Alaaddin Keykubat University, Department of Economics and Finance, vol. 4(2), pages 1-14, April.
    17. Hardin, Erin M. & Bryant, Henry L., 2016. "A Real Option Approach to Valuing and Hedging Cropland Obligations," 2016 Annual Meeting, February 6-9, 2016, San Antonio, Texas 230148, Southern Agricultural Economics Association.
    18. Sumit Agarwal & Ying Fan & Daniel P. McMillen & Tien Foo Sing, 2021. "Tracking the pulse of a city—3D real estate price heat maps," Journal of Regional Science, Wiley Blackwell, vol. 61(3), pages 543-569, June.
    19. Joan Moss & Seamus McErlean & Ziping Wu & Andrew Doherty & Jos IJpelaar, 2004. "The Long-run Impact of Different Exchange Rates on the Projected Agricultural Income of an Export Dependent Region of the UK," Others 0409003, University Library of Munich, Germany.
    20. Callahan, Scott & Ifft, Jennifer & Michaud, Clayton P., 2022. "The impact of countercyclical farm programs on agricultural land values," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322579, Agricultural and Applied Economics Association.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:canjag:v:69:y:2021:i:2:p:291-298. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/caefmea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.