The Largest Wealth Transfer in History

The Issue……

The Baby Boomer generation, now largely over 60 years old, remains a dominant force in Midwest agriculture, owning or managing a significant portion of U.S. farmland. According to the 2022 Census of Agriculture and related studies, approximately 40% of U.S. farmland—roughly 352 million acres out of 880 million total acres—is owned by individuals aged 65 or older, with a substantial portion held by Boomers and the preceding generation. 

In the Midwest, where fertile land in states like Iowa, Illinois, and Nebraska drives agricultural productivity, this figure is particularly pronounced. For instance, Iowa’s farmland ownership surveys indicate that two-thirds of the state’s land is owned by those over 65, many of whom are Boomers or older. Nationwide, the American Farmland Trust (AFT) estimates that 300 million acres, or more than one-third of all U.S. farmland, will change hands in the next 20 years due to the aging of this demographic.

This transition is driven by several factors. Many Boomers are retiring or nearing retirement, and while some continue farming, others lack successors willing to take over due to the high costs and challenges of modern agriculture. Historically, farmland was passed down within families, but younger generations, including Gen X and Millennials, have increasingly moved to urban areas or pursued non-farming careers, leaving a gap in succession. As a result, much of this land may be sold or rented to non-family members, including other farmers, institutional investors, or developers, rather than inherited. The USDA projects that 70% of U.S. farmland will change hands in the next two decades, with over 10% (93 million acres) expected to transfer in the next four years, primarily through gifts, trusts, or wills.

Land Ownership by Those Over 60

In dollar terms, the land owned by individuals over 60 is valued at approximately $1.7 trillion nationwide, based on current farmland prices. In the Midwest, where land values are among the highest due to the region’s fertility, the concentration of ownership is stark. For example, 41% of Iowa’s farmland and 50% of Illinois’ farmland are owned by non-farmers, many of whom are over 60 and inherited the land. In high-value areas like Northwest Iowa, farmland can fetch up to $15,000+ per acre, and non-farmer ownership reaches nearly 70%. The 2022 Census of Agriculture notes that 60% of U.S. farmland is owner-operated, but the remaining 40% (about 352 million acres) is rented, often by non-operator landlords aged 65 or older, who make up 38% of these landlords.

Capital Needed to Buy Farmland

The capital required to purchase farmland from this aging demographic is staggering, given rising land prices and the scale of the transition. Nationally, the average farmland price in 2024 ranged from $1,000 per acre in less productive regions to over $10,000 in prime Midwest areas. In Illinois, for instance, excellent-quality farmland averaged $14,700 per acre in 2022, with good ground at $10,710 and average land at $7,455. Using a conservative national average of $5,000 per acre, the 300 million acres expected to transition could require $1.5 trillion in total capital. In the Midwest, where prices are higher, the cost could be closer to $2 trillion for the region’s share of transferable land (e.g., 2 million acres each in states like Iowa, Illinois, and Minnesota).

These costs pose a significant barrier for younger farmers, who often lack the capital to compete with investors or larger operations. The National Young Farmers Coalition (NYFC) reports that land access is the top challenge for farmers under 40, exacerbated by high prices, and limited access to credit. For example, a 100-acre farm in Illinois at $14,700 per acre would cost $1.47 million, far beyond the reach of most beginning farmers without substantial financing or inheritance. Programs like the USDA’s Beginning Farmer and Rancher Development Program and Down Payment Loan Program aim to help, but systemic barriers persist.

Implications and Challenges

The Boomer land transition has profound implications. First, the influx of institutional investors, who increased farmland investments from $2.3 billion to $11.7 billion over the past decade, could shift ownership away from local farmers, reducing community wealth. Second, development pressures are significant; between 2001 and 2021, 1.6 million acres of Midwest farmland were lost to urbanization, with 55% converted to developed land. Third, the lack of affordable land access threatens the viability of small and midsize farms, as larger operations and investors dominate purchases.

To address this, innovative solutions are emerging. Land trusts, cooperatives, and conservation easements can reduce costs and secure land for new farmers. Policy efforts, like Missouri’s tax incentives for selling or renting to beginning farmers, aim to ease transitions. Gradual succession plans, can also spread financial burdens over time. 

Conclusion

Our hope at Farmland Stock Exchange is to create partnerships that alleviate this burden. With our Legacy LLC farmers and landowners can gradually transition their assets without having to worry about large down payments, or the disagreement between heirs that ruins family relationships. We want to sustain rural communities, that rely on agriculture and small family farms to thrive. 

Land Ledger Podcast

What does it take to keep a family farm alive for the next generation? In this episode of The Land Ledger, sixth-generation farmer turned finance professional Landon Larkin joins Brian Kearney and Marc Hartness for a conversation about the future of family farms. From beginning as an engineering student to becoming a Farmland Stock Exchange team member, Landon’s journey sheds light on the capital challenges young farmers face today and what it takes to keep farmland in family hands.

Listen in as Brian and Marc reflect on Landon’s unlikely hiring story and talk about the real-world issues facing the next generation of farmers. From succession planning to Agtech adoption, this episode highlights the balance between tradition and innovation, and why off-farm income might be the key to a seventh generation.