Dryland Cropland in Central Plains Posts 9% Gain in Fourth Quarter
Feb 15, 2012
Strong demand and high prices combined to lure increasing supplies to the market during the fourth quarter of 2011, reports the Federal Reserve Bank of Kansas City. The quarterly survey found the value of dryland cropland surged 9% during the fourth quarter versus the prior quarter and rose 25% on an annual basis. Irrigated cropland rose 7.5% during the fourth quarter and increased 25% for the year, as well. District ranchland rose 3.1% during the fourth quarter and 14% for the year.
"Robust bidding by farmers spurred record high land values, which enticed more landowners to place farmland up for auction," says the bank's fourth quarter Agricultural Credit Conditions report. "District bankers noted an increasing number of absentee landowners were putting their farms up for sale and attributed much of the auction activity to landowners seeing top-dollar prices.
"Farmers were the main buyers, and the share of land purchased by farmers has grown during the past years," the bank continues. "Still, outside investor interest in farmland for rental income or capital gains remained high, with farmland sales for recreational or development use dwindling. About a third of district bankers expected both the price and the amount of farmland offered for sale to rise further in 2012," the bank states.
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