Despite the lingering impacts of the Covid-19 pandemic, agricultural land values marked a 6% annual gain in the Federal Reserve Bank of Chicago district in 2020—the largest such gain since 2012. Moreover, values for “good” farmland in the district were up 4% in the fourth quarter of 2020 from the third quarter, according to agricultural bankers who responded to the quarterly survey. In addition 58% of survey respondents expect farmland values to rise during the January through March period of 2021; 42% expect them to be stable; notably; none expect them to decline, the bank notes.
On an annual basis, the value of "good" farmland rose 6% in Illinois, 9% in Indiana, 5% in Iowa, 4% in southeastern Wisconsin and 7% in the lower Peninsula of Michigan. On a quarterly basis, values increased 4% in Illinois, 2% in Indiana, 6% in Iowa, 7% in Michigan and 2% in Wisconsin.
Even with inflation taken into account, district farmland values had an annual increase of almost 5% in 2020; this increase in real terms was the first one since 2013. In both real and nominal terms, district farmland values peaked in 2013. At the end of 2020, district farmland values were still down 9% from their peak in real terms, yet they were nearly back to it in nominal terms, the bank comments.
Percent Annual Change by Quarter
Quarterly and Annual Percent Changes by Regions
Value of "Good" Farmland Over Time