Farmland values across the Central Corn Belt slipped 1% in the second quarter of 2019 from a year earlier, according to the quarterly survey of agricultural bankers conducted by the Federal Reserve Bank of Chicago. However, values for “good” agricultural land in the bank district were unchanged from the first quarter to the second quarter of 2019.
"Excessive precipitation in the spring led to historic flooding and widespread planting delays across most of the Midwest. Reporting bankers indicated that 69% of their borrowers were at least modestly affected by extreme weather events in the first half of 2019. Despite concerns about the effects on farming from adverse weather and trade disruptions, 83% of survey respondents expected district agricultural land values to be unchanged during the third quarter of 2019 (only 2% expected them to increase, while 15% expected them to decrease)," the bank reports.
Overall, district farmland values were the same in the second quarter of 2019 as in the first quarter, the bank states. "Yet, there was a year-over-year decrease of 1% in district agricultural land values (the first such decline since the third quarter of 2017). Iowa and Michigan had year-over-year dips in their farmland values, but Illinois, Indiana, and Wisconsin farmland values held steady. After being adjusted for inflation with the Personal Consumption Expenditures Price Index (PCEPI), district farmland values were down 2% in the second quarter of 2019 from the second quarter of 2018; the streak of year-over-year declines in real farmland values was extended to five full years.