Fall 2002

Farmland—a blue chip investment

When it comes to investment options, Wall Street can't pave the way to retirement better than an Indiana crop row.

Since 1990, Hoosier farmland has generated greater returns than stocks within the Standard & Poor's 500 index, says Chris Hurt, Purdue agricultural economist. In a stock market gyrating wildly as reports of accounting scandals rock corporate America, farmers and others who own farmland should feel vindicated.

"During the 1990s, many Indiana farmers lamented that their retirement funds were tied up in farmland, while their city cousins enjoyed years of stock returns exceeding 20 percent," Hurt says. "But when we look at this with a little bit longer perspective--and not just stopping in 1999 when the stock market looked like a glorious opportunity—it turns out that farmland has done quite well in Indiana relative to other investments and, especially, the stock market. Farmland has had a very steady rate of increase, on average, and returns have been relatively stable."