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May 2009 Archive for Your Precious Land

RSS By: Mike Walsten, Pro Farmer

Mike Walsten has covered major business trends in agriculture for more than 40 years.

Chicago Fed Survey Finds Land Values Declined in 1st Quarter; Dallas Fed reports slight gain

May 21, 2009

Mike Walsten

Farmland values declined by 6% during the first quarter of 2009, according to the survey of 227 ag bankers conducted by the Federal Reserve Bank of Chicago. That is the largest quarterly decline since 1985. The Chicago Fed bank serves northern Illinois, northern Indiana, all of Iowa, southern Wisconsin and the southern Michigan. The survey indicated land values rose by 2% for the year ending April 1, 2009.

The survey found a third of ag bankers expect land values to decline during the second quarter while almost two thirds anticipate stable land values. The survey indicated values slipped by 3% in Indiana, 4% in Illinois and 7% in Iowa and Wisconsin during the quarter. For the year, Iowa reported a 2% rise, Illinois and Indiana both listed a 4% gain and Wisconsin reported a 6% increase.

The survey also indicated cash rents increased 7% for 2009. State increases in cash rents were 8% for Illinois, 6% for Indiana, 8% for Iowa and 2% for Wisconsin, while rents in Michgan declined. Click here for more.

Land values in Texas stabilized during the first quarter, indicates the most recent survey by the Federal Reserve Bank of Dallas. The Dallas bank serves all of Texas plus northern Louisiana and southern New Mexico. The survey found the value of non-irrigated cropland increased by 1.3% during the quarter and by 6.6% for the year ending March 20, 2009. Irrigated cropland in Texas rose a slim 0.5% in the quarter and 3.4% for the year. Texas ranchland rose 1.3% in the quarter but declined 2.7% on an annual basis. Click here for the full report.

We will cover these reports in-depth in the next issue of LandOwner Newsletter. If interested in seeing a copy of LandOwner, just drop me an email at landowner@profarmer.com or call me at 800-772-0023.

Fed Surveys Find Land Values Stabilized in 1st Quarter

May 21, 2009

Mike Walsten

Farmland values stabilized during the first quarter of 2009, according to recent surveys conducted by the Federal Reserve Banks of Kansas City and Minneapolis. The Kansas City Fed reported farmland values in its district held relatively steady after modest declines at the end of 2008. The survey said non-irrigated farmland values rose 1.4% during the first quarter while there was no change in value for irrigated land. Ranchland values, however, declined slightly by 0.9%.

The Minneapolis Fed's survey indicated ranchland values held steady during the first quarter while the value of non-irrigated farmland rose 1% and irrigated farmland rose 3%. The survey also indicated ranchland values dropped 3% in South Dakota and 4% in dairy-dependent Wisconsin.

We will cover these reports in-depth in the next issue of LandOwner Newsletter. If interested in seeing a copy of LandOwner, just drop me an email at landowner@profarmer.com or call me at 800-772-0023.

Is China Spurning T-Bonds; Stocking Up On Metals?

May 13, 2009
Mike Walsten

That's the conclusion of an analysis by Ambrose Evans-Pritchard and carried in the London Telegraph. The piece outlines the extensive purchases of industrial metals made by that country -- purchases that are well beyond normal re-building of inventories. The story says China is wary of buying more U.S. Treasuries because of the massive budget deficits now being amassed by our country. Purchases of industrial metals make sense, the article continues, because they will be needed to build hybrid cars, are likely to rise in value, are easy to store, and it protects China's industrial base.

You can read the full story by clicking here.

If interested in seeing a copy of the LandOwner Newsletter, just drop me an email at landowner@profarmer.com or call me at 800-772-0023.

Survey: Average Iowa Cash Rent Rose 4.5%

May 05, 2009

Mike Walsten

Cash rents in Iowa reached an average value of $185 an acre for 2009, up 4.5% versus 2008, according to an annual survey conducted by Iowa State University Extension. The survey, conducted by William Edwards, extension economist, and Darnell Smith, extension program specialist, featured responses from more than 1,270 farmers, landowners, professional farm managers, lenders and other professionals.

Edwards and Smith said survey responses proved more variable than in previous years. "This variability is likely due to the volatility of corn and soybean prices in the past few years and led to a wide range of opinions about typical rents in some counties," they stated.

The highest average rent was $241 reported in Grundy County. The lowest was $122 reported in Davis County.

The survey findings are quite extensive and can be reviewed by clicking this link. We will also carry highlights in an upcoming issue of LandOwner Newsletter.

If interested in seeing a copy of the LandOwner Newsletter, just drop me an email at landowner@profarmer.com or call me at 800-772-0023.

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