AgLetter: May 2001
Last Updated: 05/04/01
Reduced demand to purchase farmland has slowed the rate of increase in the value of “good” agricultural land, as compared with a year ago, for the Seventh Federal Reserve District. Based on a survey of 325 agricultural bankers as of April 1, 2001, the quarterly increase in farmland values remained at 1 percent, on average, for the District as a whole. For the twelve months ending March 31 the increase was 4 percent. Although the year-over-year increase matched that of last year, more bankers expected farmland values to decline and fewer expected farmland values to go up in the next three months. Interestingly, the bankers reported that the amount of farmland for sale in recent months, as well as the number and acreage of farms sold, was higher than a year earlier. Cash rental rates for farmland showed a stronger increase than was reported last year, as farm operations in the District continued to shift toward cash rental arrangements.