How much is an acre of dirt worth? Depends on where that acre is.
I was reading an Iowa newspaper a few weeks back and the article I was reading reported the average price of farm ground in Iowa. Even though I knew land prices had skyrocketed since I left the farm, I was taken back a bit at how much a pound of dirt costs nowadays.
Our farm was sold in 1969. My dad's deteriorated back forced the sale to happen. The farm was sold for $648 an acre. We thought it was a bonanza for land that had sold 10 years earlier for $200-$300 an acre.
That was the beginning of the escalation of land prices, I believe. From that time on prices only climbed. That same land in Plymouth County, Iowa, sells today for around $6,480 per acre. My dad is no longer with us, but I can see him shaking his head in disbelief.
The days of our farm life were the days of the true family farm. Corporate farming had begun to take hold, but for the most part farms in our area were quarter section to half section farms. Some of our neighbors farmed more, but not many. Most of the grain produced on those farms was used on those farms feeding livestock.
Today, as one motors around that countryside you see nary a critter on any farm lot. Maybe a goat or two or a few hobby farm cattle or hogs, but the days of the diversified small farm are over, no matter what you hear from the media.
I dug out my grandfather's farm journal a few years back. He kept copious notes on the crops and livestock he sold over the years from the 1910s through the 1940s. Rarely did the land produce more than 50 to 70 bushel corn, 30 bushel soybeans or 25 bushel oats.
That farm today produces 200-300 bushel corn per acre, 60-70 bushel soybeans and very few raise oats anymore. A pound of dirt somehow has been milked to the extent that I sometimes wonder how long it can go on.
Gramps sold his hogs at the high of $20 a hundred pounds. Cattle hit the market at a high of $50 a hundred pounds.
Today hogs, even though selling at a loss, average around $65 a hundred pounds and fat cattle are marketing at around $126 a hundred pounds. If you factor inflation into the picture, even at today's higher prices, the profit margins are much thinner, if there at all.
A acre of dirt in the north country of northern Minnesota has changed as well. Land that at one time sold for tax forfeit prices is now selling for a couple of thousand dollars an acre. Lakeshore that was once considered wasteland is now so sought after that only a few among us can afford it.
A friend of mine who did excavation work in our area of Minnesota told me that one time one of his clients couldn't pay him for some dirt work he had done and instead gave him a deed to a mile of shoreline on a popular area lake. His wife chewed him out when he came home with the deed.
"We need money, not land!" she lamented.
Today he looks like a smart man. Not back then.
Even with the high price of dirt today, farmers are taking a blow to the gut. They are facing big-time problems today with low commodity prices, even with crop insurance and other government subsidies. Insurance and subsidies don't pay for all of the overhead involved with farming these days.
I will ever admire the tenacity of some of these folks who choose to farm. If you think you've ever worked, spend a week on one of these farms. You'll come away with a different perspective. I've seen it from personal experience.
So, what is an acre of dirt worth? It's in the eye of the beholder I guess. I've got an acre of garden and it's all the work I want at this point in my life. I guess it's worth about the value of a storeroom full of canned tomatoes, a few boxes of spuds and a bunch of pickles.
Priceless I'd say.
See you next time. Okay?