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Farmland Values Rise in the Midwest for the First Time Since 2014
The longest decline in farmland values in the Midwest since the agricultural crisis of the mid-1980s is over. Ag bankers surveyed by the Chicago Fed report a 1% rise in “good” farmland values in 2017, the first annual increase in values in three years. During the ag crisis, Midwest land values also fell for three years, from 1984 to 1986.
The high productivity of Midwestern land “helped stabilize the value of agricultural ground in 2017,” says the Chicago Fed. “The vast majority of responding bankers (76%) expect farmland values to be stable in the first quarter of 2018.”
The Kansas City Fed also says farmland values would be steady into this spring. Values stabilized at the end of 2017. “Prior to the fourth quarter, farmland values had declined at an annual pace of 5% to 7%, but those declines appear to have slowed more recently.” The Kansas City Fed’s district is the Central Plains.
The Chicago Fed (covering Iowa, Michigan, most of Wisconsin, and the northern half of Illinois and Indiana) says that adjusted for inflation, Midwest land values have experienced a 10% correction since peaking in 2013.
The average value of U.S. farm real estate – land and buildings – doubled from $1,483 per acre in 2000 to a record $3,060 in 2015, says USDA.
This article was produced in collaboration with the Food & Environment Reporting Network, an independent, nonprofit news organization producing investigative reporting on food, agriculture, and environmental health.