For the first time in 20 years, and only the third time since 1932, farm land values in Iowa have started to drop.

Thirty experts involved in banking and farm sales said in interviews this week that record prices that topped $4,000 an acre last fall appear to have peaked in early December.

Beginning last month, sales on some of the state's better quality farm land were reported off as much as $500 an acre.

Of the 30 experts, several were reluctant to acknowledge a downturn had begun, saying sales were too spotty and were giving mixed signs, some down but others steady.

But Iowa Secretary of Agriculture Robert Lounsberry did not hesitate. He said farm values have "topped out and won't go much higher, unless there is quite a bit of change in the structure" for farm commodities.

Though the experts disagreed on the seriousness of the situation, they were unanimous on its causes -- tight credit and high interest, embargoed grain and low prices, and high fuel and fertilizer costs.

A turnabout in land prices is being eyed with mixed feelings in this farm-oriented state. To those who are being forced out of farming because production costs are shooting ahead of commodity prices, it is one more piece of bad news.

"It will hurt some good young operators who just got into farming a couple years ago," and who may have borrowed money against land values that may not hold up now, Lounsberry said.

There is one bright side, however. It is likely to scare people away from investing in farm land, the agricultural secretary said. And that is no small blessing in a state that constantly frets over the future of the family farm and has passed law to prohibit farmland ownership by aliens.

Lower land values "might help the family farm because the incentive for big money to invest will not be there," Lounsberry said.

But because most farmers' ability to borrow money for spring planting is tied to their net worth, "a sharp drop in values would throw out of whack the farm debt ratio," Lounsberry said.

The first to notice a downturn in land values were the state's rural auctioneers, who hawk farm land at estate and other "distress-type" sales. Earlier this year, they noticed that an increasing number of auctions in which sellers wanted minimum prices were resulting in no sales.

In late February, one southeast Iowa farmer, caught in a squeeze by the folding of a grain elevator in a multimillion-dollar scandal, put 220 acres of marginal land up for auction. The farmer wanted at least $700 an acre but the highest bid was $400. No sale occurred.

By early April, the same thing was happening in the rich farm lands of northern Iowa, where it is not unusual for sales to top $3,000 an acre.

A spokesman for Iowa Realty, the state's largest real estate broker which has a separate division to handle farm land in central Iowa, said this week that prices on prime farm land, which usually sells for $3,000 or more an acre, are down about $500 an acre, or more than 15 percent since last fall. He said, though, prices on less expensive pasture lands that sell for $500 to $1,250 an acre are about the same.

A central Iowa auctioneer, R. Wayne Jones of Zearing, agreed prices on prime land are off $450 to $500 an acre, although, he said, many people do not believe it.

"People who say otherwise would find out differently if they put their land on the market," Jones said.

Harold Van Syoc, a southeast Iowa auctioneer, said his sales have been off about 5 percent for prime land, five to 10 percent for average land, and 10 to 15 percent for marginal land.

Some of the experts, including eastern Iowa auctioneer Marvin Waterhouse, do not like to talk about the situation. "I call it the Chicken Little Syndrome," said Waterhouse, who warned that falling prices become a self-fulfilling prophecy.

The last time there was a downturn in farm values here was during the recession of 1960, when the average value of farm land in Iowa during 1979 was $1,958, according to sale figures kept by Iowa State University.