Historical Farmland Returns
Past performance is no guarantee of future results. Please see additional disclosures.
Land is one of the oldest investment classes in existence, which in many cases has produced significant wealth over generations. We think United States farmland represents an attractive, long-term investment while providing significant relative capital preservation during times of economic turmoil.
As the chart below shows, $
invested in farmland in 1991 would be worth over $232,100 today(1).
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Past performance does not guarantee future results and there is no guarantee this trend will continue. All returns are estimates and assume reinvestment of dividends. Index information is provided for illustrative purposes only and is not meant to represent the results of an actual investment. The historical performance of each index cited is provided to illustrate historical market trends and not an individual property, fixed income instrument, or stock. The USDA Cropland values and cash rent index, St. Louis Fed 10-Year Treasury, annualized 3-month CD’s, Case-Shiller Index and LBMA Gold Prices are not investable indexes and instead represent the best available proxies for each given asset class meant to compare the historical performance of each asset class at a broader market level over long periods of time.
The S&P 500 Total Return Index annualized and Moody’s Aaa and Baa corporate bond yields from FRED are also not indexes that are directly investable, however similar indexes exist that allow for investing in each indices. For USDA Cropland, CD’s, Baa Corporate Bonds, S&P 500 TR, Case-Shiller, and Gold each index is a composite return measure of investment performance of a large pool of individual properties, fixed income instruments, real estate, or equities and not representative of individual instruments. For the USDA Cropland Index, index components consist of farmland properties often comparable to farmland offerings on AcreTrader, though the index may not be representative of the agricultural investment market as a whole. In addition, individual AcreTrader offerings and the Fund are typically comprised of individual farmland assets and therefore do not necessarily offer the diversification of a large pool of assets. Risk/reward profile for each asset class varies significantly. Investment objectives for farmland, real estate, gold, and stocks typically include long-term capital appreciation and current income, while investment objectives for fixed income are generally focused on current income. For each index, returns do not include any management fees, transaction costs or expenses and are therefore directly comparable on an expense basis. While this is a comparison of broad indexes, it is important to note that farmland and real estate investments are generally highly illiquid and long-term, while fixed income and gold investments provide limited liquidity and stocks provide a high degree of liquidity. Finally, while this is again a comparison of broad indexes, tax considerations for each individual investor will vary significantly and are not taken into account for direct comparability purposes.
Sources: USDA Cropland Returns Statistical Report (2025), St. Louis Fed, S&P 500, LBMA Gold Price, Case-Shiller, Professor Aswath Damodaran, NYU Stern 2025 (2025), St. Louis Fed, S&P 500, LBMA Gold Price, Case-Shiller, Professor Aswath Damodaran, NYU Stern 2025
With a growing global population and shrinking U.S. farmland acreage, the laws of supply and demand are clearly in favor of farmland investing. As a result, farmland has historically produced favorable returns with lower volatility relative to other alternative asset classes, as reflected on the chart below.
Perhaps more impressive is the consistency of farmland returns over time. While the value of gold or stock markets can experience drawdowns over 50% in a single year, farmland returns have been positive every year since 1990 (the first year of the index).
Farmland Returns & Volatility vs. Other Major Asset Classes(1)
Volatility
(1) Supplemental information. Please see additional disclosures for further information. Source: NCREIF, Bloomberg, Bankrate, NYU Stern School of Business, Federal Reserve Bank of St. Louis and AcreTrader calculations. All returns are estimates and assume reinvestment of dividends. Updated data published on 12/20/2021 and is for the period 12/31/1990 - 12/31/2020. Prior to this update, the data reflected the period 12/31/1990 - 12/31/2018.
While farmland investment returns can certainly be negative, we think the historical data shows the exceptional resilience of this asset class. Why has this not been all over financial news every year? Because directly investing in farmland was historically difficult and unattainable for most investors. Until now…
More Reasons to Invest in Farmland
Portfolio Diversification
- Farmland is predominantly non-correlated to other types of investment assets
Potential Inflation Hedge
- Farmland has historically shown a strong correlation to inflation due to the fact that many of the commodities produced by America's farmland are a core component of the Consumer Price Index (CPI).
Historical Wealth Preservation and Appreciation
- Low volatility in land values over the last 50 years, when coupled with farm income, has helped provide downside protection to landowners and therefore historically farmland has helped investors preserve capital through periods of economic turmoil.
