The Ledger
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Girotto: Palouse farmland yields double US wheat average at 40% premium
“Produces twice the US average. So US average wheat yields around 46, 47 bushels pretty consistently. You know, you'll even see those crop insurance T yields around 85 out there. And the price of the land is only 40% higher than if you're buying wheat farms on …”
Girotto: Farmland Values Dropped Only 4% in the 2008 Financial Crisis
“In the financial crisis, overall USDA, US farmland values went down about four percent. There was no interruption of the annual cash revenue streams that were coming out, so basically it was flat zero. Because it's the only asset class along with cash that did…”
Girotto: Iowa farmland remains fragmented among over 3,000 owners per county
“So you'll even go into a state like Iowa now, you know, has 99 counties. One of those counties will have around 300,000 acres of tillable or plantable farmland. And look in the plat book, which is basically the phone directory for land, and in there you'll fin…”
Girotto: US cropland average cash yield is around 3%
“So it's in the low threes, three percent today. So if you look at just the USDA average cropland rental rate in the US divided by average cropland value, it's come down to about three percent.”
Girotto: Farmland historically appreciates 6% annually from inflation and yield gains
“Historically, that has been around six percent. Half of that is inflation. This is a Very good inflation hedge. Soybeans go into like 3000 products, including the pen you're holding right there. I mean, it goes into everything. It is an inflation hedge, tracks…”
Girotto: Farm incomes dropped 50% after 2013 market peak
“So the commodities markets, as well as the land market, peaked basically in Q-two of 20 13. Since then, we've seen farm incomes come down by about 50%.”
Girotto: US exports 10% of corn versus 50% of soybeans
“The US corn market is mostly domestic. It's only about 10% exported, but the soybean market is almost 50% exported.”
Girotto: Over 80% of Target Farmland Is Purchased by Farmers
“80% plus of the land are bought by farmers. We don't see a lot of competition from other farmland investment funds.”
Girotto: Institutional Farmland Ownership Is a Rounding Error in $2T Market
“The size of the market is about two trillion in farmland value in the U.S., and there are two publicly traded REITs in the space, and they each own around or less than a billion in farmland. Your largest institutional investor is TIA Cref in the US. They own m…”