Comment on Oklahoma's farm and ranch lands showed increased value in 2015

By Jack Money Business Writer jmoney@oklahoman.comOklahoma's rural lands aren't exactly a gold mine for their owners. But in a year-over-year comparison, the value of those lands in 2015 increased and, at least near Oklahoma City, don't appear to have dropped much if at all in 2016, researchers and local agricultural experts have reported. Between 2014 and 2015, the average value of an acre of crop or ranch lands in the Sooner state increased by 8 percent — the largest jump seen among seven states that are served by the Federal Reserve Bank of Kansas City, a 2016 research paper written by a bank economist shows. Values for crop and ranch land in the other states served by the Kansas City branch of the Federal Reserve during that time period either were flat or fell, except for in Colorado. In dollars, the average value of an acre of crop or ranch land in Oklahoma in 2015 was $1,620, on the lower end of a range that went from $1,370 in Wyoming to $5,070 in Nebraska. Cortney Cowley, the Federal Reserve Bank of Kansas City economist who researched the issue, and other agricultural experts in Oklahoma attributed the value increase for Oklahoma landowners to: •A red-hot cattle market in 2014 •The ongoing effort to produce oil and gas from northern, northwestern, western and southwestern parts of the state •Continued growth from the Oklahoma City and Tulsa metropolitan areas •And the leasing of rural lands for recreational activities, such as hunting Surging commodity prices As part of her research, Cowley said bankers told her that rural farmers in Oklahoma benefited from a combination of good cattle prices and cash generated by higher oil and gas prices before they began to fall in late 2014. “At the same time, the demand for farmland remained pretty high while supply was still low, so there weren't a lot of properties up for sale,” she said, adding that when properties were selling, there was competition for those. Damona Doye, a farm management professor at Oklahoma State University, said Cowley's research dovetails with what researchers there have seen. Rural land prices in Oklahoma are impacted by the cattle market, and she said in 2014, “we had absolutely off-the-chart, high record profits for the beef sector, particularly the cow/calf operations. “That would have helped maintain Oklahoma's pasture prices,” Doye said. As for the impact high energy prices in 2014 had on rural land values in Oklahoma, Doye said that likely played a role. “It is hard to quantify, because often, royalties are owned separately from the land,” she said, “but we know it matters.” Bankers were telling OSU researchers they weren't seeing traditional activity during the recent boom, Doye said. “Bankers were telling us (customers) weren't borrowing because they had cash from royalty payments.Read more on NewsOK.com