Drought doesn't dampen farm land value, Chicago Fed says
Prices for Midwestern farmland continue to rise, according to a third quarter survey of 223 farmers done by the Federal Reserve Bank of Chicago.
In that quarter, farmers saw the value rise 13 percent compared to last year.
And farmers told the Federal Reserve it's not just the value of their land but also demand to buy that continues strong, even into the coming months.
Value of land rated "good" increased five percent in the third quarter, much larger than in the previous quarter, the Fed said. Prices for farm land have been steadily increasing for the past decade.
Iowa ranks as having the most expensive land in the Midwest, with an appreciation of 18 percent this quarter. Last month, an acre sold for $21,900 in northwest Iowa, a new record. (The average in Illinois is closer to $7,000 per acre).
The survey did indicate that the drought has affected farmer income, although that is mostly for livestock farmers rather than crop farmers.
Crop farmers said they expect the high payouts for corn and soybean - as well as crop insurance - to offset lost output.