Agricultural land values in South Dakota increased more than 10% each year from 2001 to 2008, including more than 20% in two years during this decade. South Dakota agricultural land values has been facing an annual increase from 4 to 10% from 1991 to 2001(Janssen and Pflueger). Cropland values increased at a higher rate than per-acre values for other agricultural land uses. Landowners are responding to higher cropland values by converting grassland into crop production. This blog mainly presents a brief overview on land pattern changes and factors behind its emergence by focusing on the available evidence.
In Lower Bad River Basin of South Dakota, land is being converted from native grass or rangeland into crop production. As long as market prices remain high, landowners in this region will continue to convert grasslands to crop production, especially to corn production. As the rate of land conversion accelerates, it will have significant environmental impacts and reduce the amount of land available for both wildlife habitat and grazing.
The availability of reliable and timely data to examine this land conversion is limited. The datasets and long implementation history of diverse conservation practices will lend itself explain that grassland conversion to cropland is being observed more frequently in past few years. Identified data sets each offering different time frames, collection techniques, and insights on this topic indicate a shift in land use in the region. There is a rich academic literature on the subject of land use change. According to these studies, land use change is driven by three primary forces: timber harvest, infrastructure development and agricultural expansion. In the study area, agricultural expansion is more responsible for land use changes compared to other two factors. In river basin, two mechanisms for land use change can be taken into consideration such as “direct” land use change, in which the land use change occurs as part of a specific supply chain and “indirect” land use change, in which market forces act to produce land use change.
Many forces that may be encouraging the conversion of land in bad river basin have intensified recently. The recent push for renewable energy, rising market prices for corn appear to be providing economic incentives to convert land. Conversion also may be facilitated by advances in biotechnology that have led to the availability of herbicide resistant crop varieties in the near future. In addition, the availability of federal farm commodity support programs is providing farmers with additional incentives to convert land from native grass into commodity crops, protecting them from full financial loss if a crop should fail. Moreover, rising corn prices and the emergence of national policies that encourage additional production of crops as a domestic source of energy have created additional incentives for landowners to convert to crop production.
Dr. Larry Janssen and Dr. Burton Pflueger., 2009. South Dakota Agricultural Land Market Trends 1991–2009, U.S. Department of Agriculture