Bank Survey Finds Pace of Gains in Plains Farmland Values Slows
Aug 15, 2011
The value of Central and Southern Plains farmland rose during the second quarter of 2011, but at a slower pace than seen in previous quarters. That's according to the quarterly survey of ag bankers conducted by the Federal Reserve Bank of Kansas City. The Fed bank serves Kansas, northwest Missouri, Nebraska, Oklahoma and the Mountains States of Colorado, Wyoming and northern New Mexico.
The survey found the value of non-irrigated and irrigated cropland climbed 2.3% and 3.9%, respectively, during the second quarter compared to the previous quarter and were 20% above values of a year earlier. Ranchland values edged only 1% higher in the quarter versus the prior quarter and held at 11% above values of a year ago. Survey respondents noted the slowdown in the rate of gain in land values since the start of the year; 75% said they felt values would level off in coming months.
Bankers said the severe, lingering drought had an impact on farm incomes in the region but that impact was not uniform across the district. Nebraska, which saw plentiful rain and favorable growing conditions recorded the largest jump in second quarter cropland values and noted cropland values were 30% higher than a year- earlier (non-irrigated values up 30.3% and irrigated value up 29.1%). Nebraska ranchland values rose 16.9%, the survey indicated. In Oklahoma, however, the drought cut wheat yields and prompted herd liquidation. These tended to restrain gains in the value of farmland. That state lists non-irrigated cropland at 10.5% and ranchland 6.4% higher than a year earlier. Kansas recorded annual gains of 21.4% in non-irrigated and 15.2% in irrigated cropland with ranchland up 8.4%. Northwest Missouri reported a 16.7% annual increase in farmland values and an 11% rise in ranchland (pasture) values. The Mountain States listed gains of 11% and 10.6% respectively in the value of non-irrigated and irrigated cropland and a 9.2% rise in ranchland.
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