Cropland prices across the Midwest slipped during the third quarter of 2014 but ranchland values continue to rise, according to the Federal Reserve Banks of Chicago and Kansas City. The Federal Reserve Bank of Chicago reports the value of "good" agricultural land slipped 2% in the third quarter compared to the previous quarter. Prices remained unchanged versus a year ago. The Chicago bank covers the northern two-thirds of Illinois and Indiana, Iowa, the Lower Peninsula of Michigan and southeast Wisconsin. The bank says declines from a year ago in Illinois and Iowa were offset by increases in Indiana and Michigan. Wisconsin farmland remained unchanged.
On an annual basis, Illinois was down 2%, Indiana up 4%, Iowa down 6%, Michigan up 1% and Wisconsin down 4% versus the previous quarter. On an annual basis, Illinois was down 1%, Indiana up 3%, Iowa down 4% and Michigan up 10%.
In its most recent survey of ag bankers in Kansas, Nebraska, western Missouri, Oklahoma, Colorado, northern New Mexico and Wyoming, the bank says the value of nonirrigated farmland slipped about 2% from the previous quarter while the value of irrigated cropland dropped about 4%. Both types of cropland are up 1% and 2%, respectively, on an annual basis. The value of district ranchland, however, rose about 3% during the quarter and about 5% on an annual basis.
The decline in farmland prices comes as farm incomes decrease due to lower grains and soybean prices, the bank says. The areas most dependent on crop income report the larger decreases. Dryland and irrigated cropland in Nebraska are off 2.5% and 2.6%, respectively, from a year earlier. Nebraska ranchland is up 3.7%. Nonirrigated cropland in western Missouri is up just 0.3% from a year ago. Pasture/ranchland in western Missouri is up 3.6%.
In Kansas, the value of dryland cropland and irrigated cropland are up 3.5% and 8.8%, respectively, due to improved crop yields. Kansas ranchland is up 5.4% versus a year ago. Meanwhile, nonirrigated cropland in Oklahoma is up 10.6% on an annual basis and irrigated Oklahoma cropland is up 5.0%. Ranchland is up 5.5% annually as well. The three mountain states report annual gains of 8% and 14.3% for dryland cropland and irrigated cropland and an 11% increase in the value of ranchland.
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