The previous post in this series (here) evaluated Peter D and Sarah’s level of success by comparing their farm productivity to that of their closest neighbors as reported on the agricultural schedule for the 1885 Nebraska census. That post, after considering farm size and land value, the value of farm goods produced, crop distribution, and crop yields and revenue, drew the following conclusions: In 1885, six years after settling in Nebraska, Peter D and Sarah were among the larger landholders in the immediate area, with possession of a full quarter section, 160 acres. However, a significant amount of that land was as yet undeveloped, and of the land that was available for raising crops, 11 percent was left fallow. In addition, for whatever reason, Peter D and Sarah fell somewhat below the average yields that their neighbors enjoyed. As a result of the limited amount of land available and the lower than average yields, they also reported a lower value of all farm productions.
There are, of course, other angles from which to examine their financial position. This balance of this post will explore one of those angles. This time, instead of comparing the Buller farm’s productivity to that of their neighbors, we will calculate it relative to the value of the land they owned and then compare that to twenty-first-century figures. One might loosely think of this as calculating and then comparing returns on (land) investment (ROI).
We begin with an admittedly simple-minded calculation of the ROI of a modern farm raising corn. I recognize that today’s farmers incur significant additional expenses to raise each crop; for the sake of a clean comparison, however, we will limit our focus strictly to land value, not the other costs associated with raising a crop today (e.g., machinery, fuel, fertilizer, seed corn).
According to the AcreValue website (see here), the average value of an acre of farmland in Hamilton County, Nebraska, is $7,703; since the Buller farm was located in Hamilton County, we will use that figure (I note that the value of land in York County is somewhat less, at $6,922 an acre).
The UNL Institute of Agriculture and Natural Resources CropWatch newsletter for 23 January 2025 (here) reports that the average Nebraska corn yield for 2024 was 188 bushels per acre. Finally, the CropWatch newsletter for 27 February 2025 reports that the average price paid per bushel of corn in 2024 was $4.45.
Based on these figures, we can calculate that an average acre of land in Nebraska would produce $836.60 in revenue (188 bushels × $4.45 a bushel). When we divide that figure by the value of the land, $7,703, we can conclude that the revenue produced by that acre would equal 10.9 percent of the value of the land ($836.60 ÷ $7,703.00). Again, these calculations do not reflect the actual costs or profits of raising corn today; they merely give us a benchmark against which we can compare the performance of Peter D and Sarah’s farm in 1885.
We discovered in an earlier post in this series (here) that the 1885 Buller farm was valued at $20 an acre ($3,200 ÷ 160 acres). In 1885 Peter D reported planting 27 acres that produced 900 bushels of corn, for an average of 33.3 bushels an acre. The price of corn that year was 25¢ a bushel, so the average revenue per acre of corn was $8.33. In other words, the revenue produced by an acre of corn equaled 41.7 percent of the value of the land ($20.00 ÷ $8.33). This is a substantially higher return than farmers in 2024 might expect.
Of course, Peter D and Sarah planted only 27 acres in corn. Another 60 acres was planted to wheat and generated $8.16 an acre, which is comparable to the average revenue per acre of corn. The rest of the 160 acres was planted to other crops (28 acres) or left fallow or undeveloped (45 acres). Perhaps, then, a more realistic comparison is the total value of the goods produced (whether for sale or consumption). In 1885, Peter D reported $652 in total farm production, or $4.08 per acre owned ($652 ÷ 160 acres). This equals 20.4 percent of the value of the land. Although this is substantially less than the corn-based ROI calculated above (40.7 percent), it is still nearly double the comparable 2024 figure.
What can we conclude from all this? According to the 1885 agricultural schedule, Peter D and Sarah’s farm produced a much higher return on their land investment than any farmer today would ever expect. If they had planted all 160 acres available to them in corn (not a realistic option at that time), they could have generated revenue equal to the value of their land in a little over two years. Even at the lower rate of return generated by the actual acres cultivated, the Buller farm was on pace to generate revenue equal to the value of the land in less than five years. Today’s corn farmers, by comparison, need at least ten years to generate revenue equal to the value of their land (and that does not account for the high costs of producing corn today).
Although we should not push this comparison too far, it is obvious that, relative to the costs incurred and revenue earned by corn farmers today, Peter D and Sarah’s farm was remarkably profitable. When one considers further (1) that they had purchased only 80 of the 160 acres that they owned (the other 80 acres becoming theirs through the Homestead Act; see here) and (2) that they had purchased those 80 acres (now valued at $20 an acre) for $900, or $11.25 an acre (see here), their success appears even greater.
In short, Peter D and Sarah invested $900 to purchase their initial 80 acres and nothing at all for the 80 acres they were homesteading. The $652 in revenue reported for 1885 was equal to more than two-thirds of their original investment. Even if only half of each year’s revenue was applied to the loan on their land, they would have paid off the cost of their farm in less than three years. This helps us to understand how, so soon after arriving in central Nebraska, Peter D and Sarah were able to purchase yet another 80 acres northeast of Henderson (see here). For these early Bullers, the United States truly was a land of opportunity.
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