The charts are interactive, follow the link for moreIf there is an epicenter of the nation's farmland boom, it can be found here amid the rolling hills of northwest Iowa.
A fortune is being plowed into the dirt of Sioux County, where well-heeled farmers and wealthy investors compete fiercely for some of the most fertile land in the Corn Belt. While farmland prices across Iowa have been among the heartland's fastest growing - up 261 percent since 2000 - they've more than tripled in Sioux County, rising faster than most of the state.
Locals could not be more pleased about such prosperity - or more nervous.
Like many people across the Midwest, they're increasingly anxious of a potential pull-back in values, despite stark economic differences with the 1980s farm crisis.
But their greatest fear is that if this boom turns to bust, as the housing market did last decade, people may well trace one of the key causes to this corner of the Hawkeye State -- and blame local farmers and investors for creating an artificially inflated benchmark for the Midwest.
In what has been termed the "Iowa effect," farmers and ranchers across the nation now routinely look to this 768-square-mile county as a benchmark for America's 408 million acres of crop land. Record-setting land deals in this corner of the state are quickly deemed the new high-water mark for surrounding states.
"I hear people talk and it's not in a good way," said Bill Tentinger, president-elect of the Iowa Pork Producers Association, who runs his family's hog farm in Les Mars, Iowa, in south Sioux County. "People see these prices and think, 'Well, if land in Iowa sells for $20,000 an acre, then why can't my farm in Illinois or Minnesota or Nebraska sell for that much?'"
Locals here will tell you exactly why: rich soil, favorable weather trends, a high concentration of livestock and biofuel operations, and an intensely competitive farming culture.
Those are some of the reasons state records have been shattered time and again at local auction halls and barnyard gatherings. Sioux County bidders cracked $13,000 an acre for crop land two years ago. Last fall, the price tag on a farm field jumped to $16,750 an acre. In December: $18,250. Then: $20,000.
That run-up, warn economists, is fueling a potentially dangerous axiom in the minds of investors: that there is plenty of profit to mine from U.S. cropland, even if prices continue to reach once unimaginable highs.
HT: Felix Salmon
"Not all dirt is the same. Some dirt is astonishing, compared to other dirt," said Jim Rogers, the billionaire commodities investor and author. "But it ultimately comes down to economics: How much does that land cost, what crop can you grow on that land, what price you can get for that crop, and how much it costs you to produce that crop?"...MORE