Your Precious Land
Mike Walsten has covered major business trends in agriculture for more than 40 years.
Central, Southern Plains Farmland Markets Show Signs of Cooling
Feb 14, 2014
Farmland values in the Central and Southern Plains show signs of cooling, reports the Federal Reserve Bank of Kansas City. That's based on the bank’s most recent survey of ag bankers in Kansas, western Missouri, Nebraska, Oklahoma and the Mountain States of Colorado, Wyoming and northern New Mexico.
"After several years of large increases, agricultural bankers indicated cropland value gains slowed dramatically in the fourth quarter and ranchland values declined slightly," state bank economists Nathan Kauffman and Maria Akers.
"From 2010 to 2012, non-irrigated cropland values jumped more then 6% from the third quarter to the fourth quarter of each year while irrigated cropland values surged an average of almost 7%. In contrast, cropland values rose only about 1% in the fourth quarter of 2013 despite fewer farms being for sale. Ranchland values actually dipped below third-quarter levels. Although farmland values remained higher than in 2012, the year-over-year gain was the lowest in more than three years," they state.
On an annual basis, the value of non-irrigated district cropland rose 9.2% compared to a year earlier while the value of irrigated district cropland rose 7.4%. The value of district ranchland rose 9.7% on an annual basis. Western Missouri led gains with an annual increase of 15.9% while the state also reported a rise of 16% in the value of ranchland. Kansas lists annual gains of 10.7% in non-irrigated cropland values, 7.0% in irrigated cropland and 6.2% in ranchland values. Nebraska reports year-over-year increases of 5.2% in non-irrigated cropland values, 7.1% in irrigated and 10% in ranchland values. Oklahoma lists a rise of 9.5% in non-irrigated cropland values, 8.4% in irrigated cropland and 7.8% in ranchland values. The Mountain States report a gain of 8.3% in non-irrigated cropland values, 1.0% in irrigated and 7.0% in ranchland values.
"A growing number of district bankers felt that farmland values had topped out and could retreat from current highs," report the authors. "At the end of 2012, only 1% of survey respondents expected a decline in cropland values compared to 16% at the end of 2013."
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