Farmland values increased by over 20% for the second straight yearin the Tenth District of the Federal Reserve Bank of Kansas City.Easing drought conditions in the Tenth District and crop pricesthat increased in the fourth quarter of 2011 lead to increasedfarmer income which was in turn reinvested in farmland thus drivingdemand for farmland and prices higher. Non-irrigated cropland increased by 8.0% in value throughout thefirst quarter of 2012 and irrigated cropland values increased 9.0%due to strong farmer demand driven by increased farmer income.Bankers in the Tenth District reported a decrease in loan volumesand interest rates while capital available to lend has been ample. Farmland Prices Farmland values posted the second consecutive 25% increaseyear-over-year in the Tenth District that includes Colorado,Kansas, Nebraska, Oklahoma, Wyoming, the northern half of NewMexico, and the western third of Missouri. The value ofnon-irrigated and irrigated cropland in the District climbed 8.0%and 9.0%, respectively, compared to fourth quarter gains of 2011.Year-over-year, non-irrigated cropland values have surged 24.7% andirrigated cropland values have increase 31.8%, the largest singleyear increase in the history of the 32-year old survey. District ranchland values increased by over 7.0% in the firstquarter of 2012 marking a year-over-year increase of 15.6%.One-third of bankers surveyed forecast farmland values to rise inthe upcoming months while the balance of bankers feel that valueswill hold steady. Nebraska lead all states in the increase of farmland values withnon-irrigated farmland increasing by 38.6% compared to the firstquarter of 2011. Irrigated farmland in Nebraska soared by 41.4%throughout the same time frame according to the survey. The droughtof 2011 has continued to fuel irrigated farmland values as farmerdemand for irrigated land continued to remain very strong. Increased farmer income lead to strong farmer demand to purchasefarmland in the first quarter of 2012. The easing droughtconditions paired with rebounding crop prices at the end of 2011generated elevated income for farmers. Often the next step farmerstook was to expand operations through land acquisitions. Anexcellent winter wheat crop condition should continue to supportelevated farmer income and farmland values. Farm Loan Portfolio The index of farm loan demand decreased to the lowest level sincethe late 1980s due to increased cash spending by farmers. In early2011, bankers reported that of new real estate purchases, slightlyover 50% were comprised of debt, but now it stands at 47%. 40% ofbankers surveyed said that more funds are now available for lendingcompared to one year ago with the amount of collateral and interestrates both decreasing as well. The loan repayment index alsoincreased to a new record high surpassing the previous high of2008, a sign of strong farmer financial stability. "Farmers are cash rich and very liquid. Demand for loans isdown," noted one banker in South Central Nebraska. The 2012first quarter interest rates averaged 6.2% for farm operatingloans, and fell to 5.8% on farm real estate loans thus promotinglending opportunities. For daily articles on farmland and agriculture, visit. We are high quality suppliers, our products such as Cool Halloween Decorations , China Led Projector Pen for oversee buyer. To know more, please visits Keychain Laser Pointers.
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