Midwest farmland values up in third quarter

According to the Chicago Federal Reserve, farmland values in the Midwest were up 2% in the third quarter of 2020 from a year ago. This District has not seen this large of a year-over-year increase in its farmland values during the past six years. This rise is attributed to support from lower interest rates, additional government payments and some rising agricultural prices. However, according to the 144 bankers responding to the Oct. 1 survey, values for “good” agricultural land in the District overall were the same in the third quarter of 2020 as in the second quarter.

When surveyed about expectations for the fourth quarter, 82% of the respondents anticipated the District’s farmland values to be stable. Yet, according the Chicago Fed’s quarterly AgLetter, more of them anticipated an increase in District farmland values in the final quarter of this year than anticipated a decrease.

According to the report, Indiana and Wisconsin led the way with year-over-year jumps in their farmland values of 6% and 3%, respectively. The growth in farmland values in Illinois (2%) and Iowa (1%) was more modest.