Dallas Fed Notes Steady to Firm Farmland Values

Posted on 10/04/2018 11:57 AM

Texas ranchland and dryland cropland values rose more than 5% for the year ending Sept. 30, according to a survey of ag bankers conducted by the Federal Reserve Bank of Dallas. The bank reports the value of Texas dryland cropland increased 5.8% and ranchland rose 5.5% compared to a year earlier. Meanwhile, the value of Texas irrigated cropland slipped 0.4% versus a year ago.

Similar data is reported for the entire Dallas Fed district, which includes northern Louisiana and southern New Mexico. The value of district dryland cropland and ranchland rose 5.7% and 5.6%. respectively. The value of district irrigated cropland rose a slim 0.7% versus a year earlier.

Looking ahead, the Fed reports: "The anticipated trend in the farmland values index was positive for a sixth consecutive quarter, inching up to its highest value since 2014 and suggesting continued expectations for farmland values to trend up in the upcoming months."

The bank states: "Bankers responding to the third-quarter survey noted some easing of drought conditions across several regions of the Eleventh District. However, many contacts continued to note significant difficulties with dryland crop production due to lack of moisture. Hay inventories remain very tight, which continues to put pressure on livestock production.

"Demand for agricultural loans overall decreased for a 12th consecutive quarter. Loan renewals and extensions rose slightly, while the rate of loan repayment largely stabilized after declining in the prior two quarters. The volume of non-real-estate farm loans was slightly lower compared with a year ago, while the volume of farm real estate loans declined more significantly. The volume of operating loans declined modestly, while volumes of all other loans declined sharply in the third quarter."

Dallas District Real Farmland Values

Farmland price trends in the Dallas Fed Bank district
Federal Reserve Bank of Dallas

 

Dallas District Real Farmland Values

Cash rents across Dallas Fed District
Federal Reserve Bank of Dallas

 

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