Weekend Economists Ring in the Old, Wring Out the New: Dec. 30, 2011 to Jan. 2, 2012

[Demeter]

69. Farmers seeking high profits add acreage, harvest 'rottenest' land

http://www.nytimes.com/2011/12/31/us/in-iowa-farmland-expands-as-crop-prices-soar.html?_r=1

A splash of green on a solid beige horizon, the golf course at the edge of this tiny town promised residents nine modest holes of refuge from corn country. Decades earlier the spot had been farmed, too, but the rocky soil was so poor, the saying went, that you couldn’t raise hell there with a fifth of whiskey. “The rottenest piece of land there is,” said Mick Elbert, a local car dealer who served on the golf association board. “All it is good for is a golf course. That’s why we built it there.”

But this year, over a chorus of objections, the greens and fairways were plowed under. The course had been losing money, and crop prices had been breaking records, so the new owner did the type of quick calculation that is quietly reshaping the region and determined that it was more valuable as farmland. The first harvest took place this fall.

Across much of the Midwest the sharp increase in farm earnings has driven the price of farmland to previously unimaginable — and, some say, unsustainable — levels. But in the process, to much less fanfare, the financial rewards have also encouraged farmers to put ever more land into production, including parcels that until recently were too small or too poor in quality to warrant a second glance...

Farmers are taking down the old barn or the grove of trees that shaded a corner of the family farm to squeeze in a few more rows of crops. They are plowing up areas previously used for grazing cattle or set aside for conservation because they had been deemed too wet, too sandy or too hilly for farming. And they are returning crops to places that had been reserved for ostensibly more lucrative purposes like strip malls, housing developments or, in several cases, struggling small-town golf courses. “One day it’s grassland, and the next day it’s black dirt,” said Jim Ringelman, the North Dakota-based director of conservation programs for Ducks Unlimited, a hunting and conservation group worried about the trend. “It’s that quick.” ...

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