In the US, the subprime mortgage lending crisis was caused by good borrowers over leveraging the cheap mortgage rates they could get and buying extra homes to flip. When the money dried up and there was no one to flip to, they went under en mass. If farmers have been over leveraging on farm land, then something similar to a crash makes sense especially if yields are down or prices fall because of surplus.
Farm land borrowing is through completely different organizations from home loans. Farm Credit Association, for instance. And the backer is FmHA, the farmer lending equivalent of FNMA.
Farm lending is not nearly so highly leveraged as home lending. FmHA equity requirements are much larger than on home loans.
Farm land prices are driven by commodity prices. When corn and soybeans were high, Iowa cash rents went up, and land prices followed. Commodity prices have come down, cash rents have come down, and land prices are following.
There is some speculation on price appreciation -- just about any Iowa farmer will tell you about "the piece of ground he wish he had bought", but didn't have the stomach to bid higher on at the auction. Most farmers are buying land with the idea that it is a multi-generational investment, and when good ground near/adjacent to your current farm comes up, you tend to dig deeper into your pocket and hope your children will see the value appreciation -- because that piece may not come on the market again in your lifetime. So there is a certain psychological component priced in to the bid, but mostly it has to pencil out.
If you think land prices are completely unhinged, then here is an anecdote: I own some ground in Winnebago county Iowa. When land in Winnebago county was selling for $11K/Ac there was land 5 miles north on the Minnesota side of the state line selling for about $10K/Ac. Same soil type. Same weather. Same local market elevators to sell crops to. Same local market seed/chemical coops to buy your input. Why the difference in price? Minnesota real estate taxes are higher (I won't go into the politics of that.) The taxes are a per-acre annual production cost, and get priced into the land value.
Commodity prices are coming down, that is causing the income squeeze. Leveraged farmers are going to feel a squeeze, certainly. But the amount of leverage is nothing like what was happening to home owners during the housing crisis. Farm land owners simply can not borrow at those kind of loan-to-value ratios.
(Source: Owner and/or partner in several pieces of farm land in Iowa and Minnesota, some inherited, some purchased.)
Oh.. about corn prices... back when there were enough ethynol plant building permits on file to eventually make Iowa a net importer of corn... yeah, that was a corn price bubble. Those days are gone. (Let's not diverge into the silliness of ethynol, we all know it defies physics.)
