BISMARCK — A recent land auction in central North Dakota very likely set a mark for the highest valued irrigated land in the state.
The auction for a pair of parcels at the intersection of Highway 1804 and 149th Ave. NW — near the Missouri River north of Bismarck — took place Tuesday, March 28. The auction was held by Moorhead-based Pifer’s with in-person bidding taking place at the Ramada by Wyndham in Bismarck.
The second of the two parcels was the marquee attraction for the auction, which drew a hearty crowd of 39 registered online bidders in addition to 23 assembled at the Ramada, Pifer’s co-founder Kevin Pifer told The Forum. The parcel consisted of 183 acres of cropland, with 130 of those acres irrigated by a pipeline feeding directly from the Missouri River.
In total, the full parcel fetched $8,000 per acre at auction, which Pifer told The Forum is “likely” an all-time high for irrigated farmland in central North Dakota. The first, non-irrigated parcel at the auction brought in $5,250 per acre.
Referencing the non-irrigated parcel’s sale price, Pifer was able to parse the numbers further. By disregarding the less valuable, non-irrigated land from the full 183 acre parcel, Pifer estimated the irrigated portion alone was worth “a little over” $10,000, which would also “likely” be a statewide record.
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Even if the sale price is not an official record, it was a memorable one for Pifer, who said he does not recall seeing a value that high. “We’ve never sold irrigated land for $10,000 an acre. Irrigated land usually brings $7,000 or $8,000,” he said. “That’s a big number.”
The land was put up for auction by the Dakota Conference of Seventh Day Adventists. The organization reported to its members via Facebook that the auction raised $2 million. The majority of those proceeds are slated to be placed in an “interest-bearing endowment fund.”
Pifer, who himself served as the auctioneer for the sale, cited four contributing factors which he felt drove up the price.
Firstly, Pifer said that it is “rare” for irrigated land to hit the market in North Dakota. “Even though we have 23 million acres of cropland in North Dakota, very little of it is actually irrigated,” he remarked.
Irrigated land requires a perfected irrigation permit from the North Dakota Water Commission. Securing a permit is “normally a very long process,” Pifer said. State laws are designed to protect existing permit-holders, he continued, noting that some aquifer wait lists can stretch 15 or 20 years.
Pifer also pointed to the plot’s “exceptional” loam soil for steering the price upwards. The full parcel had a weighted productivity index, which ranges from 0 to 100 with 50 being the average, of 85.8. For comparison, Pifer said soil in the farm-rich Red River Valley typically scores between 82 and 85 on the index. “When you get productivity indexes in central North Dakota in the 92, 83 and average 85.8 (range), those are highly-productive soils,” Pifer explained.
The parcel’s loam soil is ideal for a broad range of crops, including corn, soybeans, potatoes and even dry edible beans, Pifer said. Being hospitable to various crops allows farmers to rotate crops and further improve soil health, he said.
The parcels’ easy access to Highway 1804, a paved roadway, also increased the land’s value, Pifer believed. While it is located just 13 miles north of Bismarck, Pifer felt the proximity to the capital had little impact on the final price.
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The auction’s turnout was a sign that there is “pent-up demand” for such land in central North Dakota. It didn’t hurt that area farmers weren’t shy about starting a bidding war, either. “That area is very competitive,” Pifer commented. “There’s a lot of very good farmers that are very competitive with one another whenever land like this comes up for sale or even for lease.”
The recent auction is indicative of a larger trend Pifer has observed when it comes to farmland sales. “We’ve seen an uptick in irrigated farmland values over the course of the last 18 to 24 months. In fact, all farmland in North Dakota has been up significantly, 25 to 30%, in the last 18 to 24 months,” he said.
The land sale ultimately proved to be small but mighty. “This was a very, very good farm. It wasn’t very big, but it was very good,” Pifer concluded.
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