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The Impact of Ethanol Plants on Cropland Values in the Great Plains

Author
Henderson, Jason R.; Gloy, Brent A.
Abstract
Corn ethanol plants consume large amounts of corn and their location has the potential to alter local crop prices and surrounding agricultural land values. The relationship between ethanol plant location and agricultural land prices is examined using data obtained from the Agricultural Credit Survey administered by the Federal Reserve Bank of Kansas City. The findings indicate that the portion of land price changes attributable to location is consistent with previous estimates of basis changes associated with ethanol plant location. As a result, the land markets appear to be rationally adjusting to the location of ethanol plants.
Description
WP 2008-01 January 2008
Date Issued
2008-01-01Publisher
Charles H. Dyson School of Applied Economics and Management, Cornell University
Subject
farmland; ethanol; land values
Type
article