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SUNDAY, SEPTEMBER 15, 2013 But as the price of commodity crops has climbed steeply, so has the demand for tillable farmland here. Land prices have doubled over the past five years as the area has evolved into a mecca for out-of-state farmers. Amish farmers have moved from Ohio and Pennsylvania to start farms here, while farmers from states across the Northeast and Midwest have scooped up the once inexpensive farmland to grow cash crops. Tillable farmland in the southern half of the county sold for $1,000 to $1,500 per acre five years ago, farmers say, but now goes for $2,000 to $3,000 per acre. In the county’s northern half, farmland that sold for less than $500 per acre is now priced at more than $1,000. Thanks to recent land purchases, the 950-cow dairy farm now owns about two-thirds of its 2,900 acres of tillable farmland; it leases the rest. About 1,600 acres of corn silage and 1,300 acres of hay will be harvested this fall. In February, Butterville Farms joined Robbins Family Grain, Sackets Harbor, and Hillcrest Farms, Ellisburg, to buy 2,600 acres of prime farmland in the towns of Watertown and Hounsfield for $4 million from a Connecticut landowner. In that deal, Butterville acquired 400 acres of tillable farmland off Route 3 in the town of Watertown. That price was considered expensive at the time, Mr. Barney said, but the land “has now at least doubled in value. We’d now get $4,000 per acre for that land.” “Here, everything we harvest goes through our cows,” he said. “As far as corn goes, it’s better that we harvest from our own land, because it’s now cheaper to grow than it is to buy. And if you wait to buy land, you can’t get any. We’d like prices to go back down to where they were, but I don’t think that’s going to happen.” Because of that trend, cash-crop farmers have purchased marginal farmland with heavier clay in the northern half of the county during the past five years for low prices, Mr. Hunter said. Soil on farms north of the Black River tends to drain water less efficiently, which results in lower harvest yields. While buying marginal farmland for cash crops is unusual, he said, farmers are raking in profits by doing so. As a result, Mr. Hunter said, farms that were leasing land at low prices have sometimes been bought out by cash-crop farmers who are willing to pay more. That is also a recent trend. OUT-OF-STATE TRANSPLANTS Despite climbing prices, tillable farmland here still is much less expensive than in other states, Sackets Harbor dairy farmer Ronald C. Robbins said. Ten years ago, he said, Jefferson County launched marketing initiatives to lure farmers from outside the region to take over farmland here. But those efforts have been scaled back, he said, because the influx of farmers from outside the region is competing with local dairy farms to buy land, driving up prices. He said cash-crop farmers have relocated operations to the north country from Kentucky, Nebraska, Iowa and Canada. Amish farmers have relocated here from Ohio and Pennsylvania. Tight competition for farmland has spurred large dairy farms such as Robbins Family Grain, which has 950 cows, to acquire farmland while they still can, Mr. Robbins said. After acquiring 950 acres of tillable farmland in the $4 million, three-partner sale in February, the farm plans to harvest 2,600 acres of corn for grain and silage, 2,200 acres of hay and 900 acres of soybeans this fall. A 280-stall dairy barn was built recently at the Sackets Harbor farm off County Road 145, which will enable it to expand its herd to more than 1,100 head of cattle over the next two years. Some small- to medium-size dairy farms, though, find it challenging to expand because of the farmland’s high prices, said Arthur F. Baderman, agricultural educator at Jefferson County’s extension office. “Some of these small farms don’t have anyone in the family to take over and are tired of milking cows,” he said. “They’re looking to either rent or sell land at high prices to larger farms so they can keep living in houses they’ve always lived in. They want to wipe the slate clean and have money for retirement.” Over that period, “there have been about six boom times where land values have increased at a rapid rate. But then we’ve hit times where land prices have gone from a positive to negative trend,” he said. “These cycles happen, and you can’t expect what’s going on in the last five years to be the trend in the next five, or further on out. Steep money and high commodity prices encourage people to buy land and expand, but that will change if we go back to low commodity prices in a year and interest rates go up.” “We were generally buying land here for 500 to 600 bucks a year ago, but now it’s over $1,000,” he said. “I think prices are going to go up 10 percent a year for a long time, because everybody is driving up the prices, and you have guys who are doing strictly crop farming.” Continue reading →