Farmland Values Surge Alongside Strength in Agriculture

Agricultural credit conditions in the Federal Reserve Bank Tenth District remained strong in the third quarter, and farm real estate values increased sharply. 

The Kansas City Federal Reserve Bank reports farm income and loan repayment rates continued to increase at a steady pace and contributed to multi-year lows in problem loans and asset liquidation. 

While conditions have improved substantially from recent years throughout the region, the pace of increase in farm income and loan repayment rates was slower in areas most significantly impacted by drought. 

Alongside a strong agricultural economy and historically low interest rates, the value of all types of farmland was about 15 percent higher than a year ago. 

Most lenders have remained optimistic about the outlook for agriculture but have expressed concerns about rising input costs. 

The Tenth Federal Reserve District covers the states of Colorado, Kansas, Nebraska, Oklahoma, and Wyoming, 43 counties in western Missouri, and 14 counties in northern New Mexico.

(Story Courtesy of NAFB News Service)