More than 200 people, many of them local farmers, packed a room at the Adams County Fairgrounds in Hastings, Neb., on Thursday morning to see bidding go as high as $11,386 an acre for one of 16 tracts sold.
All but one of the tracts, offered for sale by an investment group, were sold to local buyers, auctioneer Roger Diehm said.
“What we saw today was primarily local farmers prevailing over a single, $15.1 million bidder,” who was an out-of-state investor, said Jim Hain, vice president at Lund Co., which listed the land.
“The local farmers here made a great effort to keep this prime land in local hands,” Hain said.
The names of the buyers and sale prices for individual tracts were not immediately available.
Hain said the sale was the largest auction of farmland in Nebraska so far this year in terms of acreage. Nine buyers paid $15,432,600 for 1,855 acres of the Buffalo Hill Farm, or an average of $8,319 per acre for land that varied by quality but included 1,360 acres of irrigated cropland. Schrader Real Estate & Auction Co. handled the sale.
“I don't think it's above the market,” Diehm said. “When you look back at the history, the last couple of months there's been a lot of ground at $10,000 an acre.”
The price of farmland in south-central Nebraska rose 32 percent in the year ending Feb. 1, 2012, to an average of $3,352 an acre, with an average sale price of $5,900 for center-pivot-irrigated land in that area, according to a study from University of Nebraska agricultural economist Bruce Johnson.
“Prices do continue to rise,” said Doug Stark, president and chief executive officer of Farm Credit Services of America. And agricultural real estate sales volume is up 30 percent this year.
“Overall, farmers are in reasonable shape financially, and there's not a lot of good investments in other parts of the economy, or you don't return much for your cash,” he said.
Stark said the local farmer interest was not surprising.
“Farmers, because that's their livelihood, are much more interested in farmland than investors would be. Investors may be demanding a little higher return than a local farmer would” if the property complements his existing operations, Stark said.
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