An Examination of the Relationship Between Cash Rent Values and Net Crop Returns in Indiana
Abstract
In response to marked corn and soybean price declines, Indiana growers are reducing production costs. Since cash rent is a major production cost, this thesis assists growers by creating a metric to evaluate the impact of decreased net crop returns upon cash rent within the state of Indiana while accounting for differences due to land quality and a 2007 structural change. While there is a significant and positive relationship between net crop returns and cash rent for Indiana as well as for high and medium quality land, it appears other factors are driving cash rent values for low quality land. Additionally, the 2007 structural change instigated substantial changes in the relationship between cash rent and net crop returns. This thesis concludes that the declines in net crop returns will cause marginal declines in cash rent with the full impacts not realized for several years.
Degree
M.S.
Advisors
Langemeier, Purdue University.
Subject Area
Agricultural economics
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