Latest USDA estimates point to softened growth in Oregon’s farmland values

The U.S. Department of Agriculture recently released its latest state-level data on farmland values. The data come from the USDA’s June Area Survey, which asks a rotating panel of producers to estimate the market value of their land. Responses from surveyed farmers are then weighted and extrapolated to generate estimates for entire states. The survey-based estimates are broken down into four categories of per-acre land values:

1. Farm real estate, measuring the value of all land and buildings on the farm
2. Non-irrigated cropland
3. Irrigated cropland
4. Pastureland

In Oregon, the nominal (not adjusted for inflation) per-acre value of farm real estate is $3,780 in the most recent data, representing a $60 (1.6%) increase in nominal terms over the past year (see Figure 1 and Table 1).

It is often informative to examine trends in farmland values over time using real (or inflation-adjusted) values, which account for shifts in values relative to incomes and the prices of other goods. After adjusting for inflation using the Bureau of Economic Analysis’ Gross Domestic Product Implicit Price Deflator, the change in farm real estate value amounts to a $15 (0.4%) decrease in 2025 dollars. This marks the first time since 2013 that the USDA has reported a real decline in the value of Oregon’s farm real estate. When compared to its most recent five-year average over 2020–24, however, inflation-adjusted farm real estate values remain up by $258 (7.3%).

Non-irrigated cropland values decreased to $3,000 per acre, which represents a real change of -$71 (-2.3%). In contrast, the value of irrigated cropland continued its upward trend over the past year, increasing to $8,000 per acre, a $196 inflation-adjusted gain of 2.5%.

Pastureland value, at $1,080 per acre, increased by a more modest 0.8% over the past year.

Relative to their five-year rolling averages over 2020–2024, all classes of land values, including non-irrigated cropland, point to growth in 2025. Although growth appears to have weakened over 2024–25 for all classes of land in Oregon, values for all categories of Oregon’s farmland have generally more than kept up with inflation in recent history (Figure 2).

With aggregated state-level survey data, it is difficult to tease out any direct cause of the observed trends or year-to-year changes. Compared to other states in the Pacific Northwest (Table 2), growth in the value of Oregon’s irrigated cropland stands out. For non-irrigated cropland and farm real estate as a whole, however, Oregon ranks last of the four states. Growth in Oregon’s pastureland values ranks third. Of the four states, Idaho saw the strongest annual rate of growth in 2025.

Analysis by AgWest Farm Credit based on its own proprietary farmland sales database (not the USDA survey data) points to several factors that have affected land values in Oregon over the past year. AgWest notes that a relatively high inventory of land available for sale in Central Oregon, combined with lower-quality land available for purchase, may soften the recent run of price increases seen across Oregon. Similarly, it also cites the 2024 wildfires as a potential factor shaping farmland markets in Oregon. This corroborates ongoing OSU research that shows how wildfires reduce the price of nearby agricultural lands, particularly land used for grazing.

To be clear, although the USDA is reporting a slight decrease in the value of Oregon’s farm real estate overall, it represents a minor departure from what has been 25-plus years of near-constant growth. The fact that the Federal Reserve seems poised to lower its benchmark interest rate over the coming year — potentially multiple times — will put upward pressure on future land prices. It will reduce borrowing costs for producers, free up cash to put toward land purchases and reduce the discount put on expected land-related earnings in future years.

Keep in mind that the USDA numbers reflect what producers perceive to be the value of their land, which, in aggregate, tends to be lower than the price actually paid for land that is bought and sold. In other words, the USDA survey does not represent the prices resulting from observed land market transactions. The survey is broader, in the sense that it is supposed to capture the value of all farmland throughout the state, the vast majority of which is not put up for sale in a given year.

Although observed prices tend to be higher, they usually move in the same direction as the survey estimates, at least for Oregon over the past 25 years or so. The fact that the survey estimates tend to be lower than observed prices could indicate that demand-side competition for land drives up the resulting price or that the land involved in sales tends to be of higher quality.

In general, the public would benefit if the USDA published supplemental information for the survey estimates, such as response rates and margins of error. That would allow for deeper analysis into why they differ from observed land price levels.

Of course, the fact that Oregon’s agricultural land has continued to appreciate in value has both pros and cons. Investors tend to be drawn to farmland because it generally keeps pace with inflation, making it a relatively safe and attractive asset class. Having access to affordable farmland is key for producers, as real estate is the most common source of collateral in farm-related loans.

Besides investment interest, the most recent AgWest report also notes that demand remains strongest from large operators. Because land is often used as collateral in securing farm real estate loans, small producers may be at a disadvantage when accessing both the land and financial capital they need to grow their operations.

This article is updated annually based on the U.S. Department of Agriculture's farmland values estimates. See the previous version of the article.