Biggest Rise in Midwest Land Values in Over a Decade

Agricultural bankers reported a 22% increase in farmland values in the central Corn Belt during 2021, and they expect values to continue to rise in the opening months of this year, according to the Chicago Federal Reserve Bank in its recent quarterly AgLetter report. Iowa had the largest increase, 30%, in the five-state Chicago Fed district.

On the whole, the district experienced a very steep annual increase in its farmland values in 2021. “In nominal terms, 2011’s annual increase was the last gain as large as 2021’s. The increase in land values was aided by low interest rates, government subsidies to farmers, strong commodity prices, and high corn and soybean yields.

Some 56% of bankers taking part in a Chicago Fed survey said they expect farmland values would rise in the first quarter of 2022; only 1% predicted a decline. An Illinois banker added, “Farmers were able to realize nice profits in 2021.”

EDITOR’S TAKE:

Your CAD team has repeatedly encouraged all members to “Look Beyond Your Lot”. What we mean is to look beyond the current conditions you face and really examine who will be your best customer prospects as supplies begin to “normalize” in the months ahead. This article simply puts an exclamation point on why we keep saying it’s farmers and ranchers who will fill that top billing. They have money in the bank. They are paying down debt at a record pace. The value of the land they own is skyrocketing, thus, making their balance sheets look better and better. And any concerns they have about inflation – well look no further because you have AgPack. The exclusive rebates and discounts could now add up to nearly $30,000! It’s the right time to put farmers/ranchers at the top of your priority customer list.