Farm land values in the U.S. Midwest increased 25% in the third quarter of 2011, the most since 1977, as rising net income for corn and soybean growers and improved cattle, hog and milk earnings supported higher land prices in Iowa, Illinois, Indiana, Michigan and Wisconsin, according to the Federal Reserve Bank of Chicago.
Land values rose 7% from the second quarter, and banks are predicting further rises in the fourth quarter of 2011. Farmland values in Iowa, the largest producer of corn and soybeans, rose 31% from 2010, according to the Federal Reserve Bank. Indiana values rose 29%, Illinois 23%, Wisconsin 17% and Michigan 16%.
Interest rates have fallen for operating and real-estate loans, improving credit conditions for agricultural producers, according to banks. Repayment rates rose in the third quarter compared to 2010 numbers and loan renewals and extensions declined. Loans to buy farm machinery and build grain storage are expected to rise by the end of the year compared to 2010, while the value of all livestock loans is forecast to fall, according to the Federal Reserve Bank.
Land values rose 7% from the second quarter, and banks are predicting further rises in the fourth quarter of 2011. Farmland values in Iowa, the largest producer of corn and soybeans, rose 31% from 2010, according to the Federal Reserve Bank. Indiana values rose 29%, Illinois 23%, Wisconsin 17% and Michigan 16%.
Interest rates have fallen for operating and real-estate loans, improving credit conditions for agricultural producers, according to banks. Repayment rates rose in the third quarter compared to 2010 numbers and loan renewals and extensions declined. Loans to buy farm machinery and build grain storage are expected to rise by the end of the year compared to 2010, while the value of all livestock loans is forecast to fall, according to the Federal Reserve Bank.
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