Farmland values tended to stabilize the first half of 2014, following weakness at the start of the year, according to recent surveys conducted by the Federal Reserve Banks of Chicago and Kansas City. The exception is in the southern Corn Belt and Mid-South, where values are weaker. The Chicago Federal Reserve reports farmland values rose 2% during the second quarter of 2014. The result of that firming in values put the value of district farmland in the central Corn Belt at 3% higher than a year earlier.
The Kansas City Federal Reserve says the value of both dryland and irrigated cropland rose slightly less than 1% during the second quarter. That results in both categories of crop marking a 6% annual increase. The bright spot is ranchland values, which rose more than 2% in the second quarter across the Central and Southern Plains. On an annual basis, district ranchland values are up 9%.
The exception is the St. Louis Federal Reserve Bank, which indicates the value of farmland is down 6.7% from the high posted in the fourth quarter of 2013. Pastureland values are down 7.5% from fourth-quarter 2013, as well.
These surveys give land watchers a view of the pulse of land values through midyear. The rise in commodity prices this spring tended to support farmland prices, with the exception of the southern Corn Belt and Mid-South. Going forward demand will obviously be dampened by the low commodity prices but strong yield prospects will tend to soften the weakening in demand.
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