Farmland values are falling for the fifth year in the Midwest, and one factor in the decline is “muted expectations for farm income” this year, said the Chicago Federal Reserve Bank on Thursday. “The profitability of many corn and soybean farms will almost surely fall from their 2018 levels — possibly by a lot for some.”
Farmers are increasingly dour about the outlook for U.S. farm exports, with 27 percent expecting lower soybean prices in the year ahead — nearly double the figure from a month earlier, said a Purdue University poll of 400 producers.
Agricultural bankers reported a 1 percent rise in “good” farmland values in 2017 in a survey by the Chicago Federal Reserve Bank, which said the productivity of midwestern farmland had helped stabilize prices. It was the first increase in values since 2014.
The amount of land used for agriculture in Hawaii has declined 68 percent since 1980, primarily because of the end of pineapple and sugar cultivation, said the Washington Post.
The Kansas City Federal Reserve Bank says the prolonged decline in farm income pushed farmland values lower in the central and northern Plains, "but at a modest pace" of 3 percent for non-irrigated land during the summer. The Chicago Federal Reserve Bank said land values, although relatively stable for the past year, fell 1 percent during the summer.
Farm lending has stabilized in the face of low agricultural profit margins, says a quarterly Federal Reserve report on ag banks. Operating loans, to pay day-to-day expenses, have accounted for nearly 60 percent of non-real-estate loans for the past year, "the highest in the 40 year survey history," says the report of conditions nationwide.
Although corn and soybean prices are lower than a year ago, farmland values in the Midwest are up by 1 percent compared to this point a year ago, the first year-over-year gain in three years, said the Chicago Federal Reserve Bank. But land values fell in the central Plains, according to ag bankers surveyed by the Kansas City Fed.
African-American farmers lost millions of acres of land across the South as a result of an obscure legal provision that is only now being corrected in state legislatures around the country, according to FERN’s latest story by Leah Douglas produced in partnership with The Nation magazine. (No Paywall)
After falling by 10 percent since 2013, farmland values in Iowa, the No. 1 corn state in the nation, are marginally higher, with the recovery expected to continue into the future, says Successful Farming. "We think the bleeding has stopped," said Iowa State University economist Wendong Zhang at ISU's annual soil management and land value conference.