Buyers and sellers
So, who's buying and who's selling?
Huber says farmers are the primary buyers in central Illinois. Most of the sales are estate related. Though investor purchases have cooled a bit, they haven't dropped out.
"Investors don't push the top price," Huber notes. "The top end for investors appears to be around $11,500."
Aupperle agrees. He wagers 75% of the 2013 buying group across central Illinois was primarily composed of local farmers and businessmen.
The majority of farmers are putting a significant chunk of cash down on land and financing a portion of the sale. Huber says banks still appear quite willing to loan money in these low-leverage scenarios.
Overall, Huber is still bullish on land. He describes the current situation as a "mild correction cycle." Most importantly, he notes $4 to $5 corn will support these values. If corn falls below $4, he expects things will change significantly.
Aupperle reminds folks that farm income is a product of two variables: yield and price. It's been some time since farmers have seen trend-line yields. If those return, Aupperle says incomes can remain high, even if the price per bushel slips.
"I think we'll be making our future profits on bushels per acre, not price per bushel," he adds. "Don't focus only on price per bushel. Determining profitability is a two-phase approach."